We will be going to Ireland & Northern Ireland in a few weeks. I called my credit card companies to ask about foreign transaction fees and exchange rates. Several of my "big bank" credit cards (like Bank of America and Barclay's) stated they had foreign transaction fees of 1 to 3%, but could not tell me what kind of currency exchange rate mark up they used. Capital One told me they did not have a transaction fee, but also could not tell me anything about their exchange rate mark up. MY QUESTIONS: Do all major American credit cards use basically the same currency exchange rate calculations? Are some "more fair" than others? Should I go with a Capital One because of no transaction fee, or would I usually get a better currency exchange rate with a larger bank credit card? Thanks! Steve
I would expect the interbank exchange rate to be identical regardless of which bank you use. It varies from day to day but should be the same regardless of which bank you choose. Shop for reasonable foreign transaction fees (can be zero to 3+ percent and/or a flat fee per transaction). Capital One's Venture cards are used widely because they don't charge a transaction fee You should also keep an eye out for an "offer" to convert the charge into dollars. The short answer is always choose to pay in local currency. If you choose to let them change, you will pay an extra fee.
The banks all use very good exchange rates for credit cards. The mark up is the 1-3% you were quoted. But the rate itself is good, and is not marked up - as long as you are charged in local currency, not in dollars. As stated above, there are lots of reports of merchants in Ireland being particularly bad about trying to force you to accept a charge in dollars. Always refuse this "service" (called dynamic currency conversion). You'll get a worse exchange rate than the bank offers, and still have to pay the foreign transaction fees of 1-3% (0% with Capital One).
My information is not up to date but it used to be that in Ireland one could often get a worthwhile discount by paying (for a B&B, etc.) in cash. If you have a favorable rate using a debit card to access ATMs consider it.