A reader writes:
My Visa card used to be an excellent deal for foreign travel. Charges were converted at the interbank currency rate, since the clearing center dealt in zillions of dollars daily. Much lower transaction cost than an individual could get. Visa could still make money by offsetting transactions (e.g., charges in francs payable in dollars and charges in dollars payable in francs). It only had to convert the difference.
Then, it moved to the consumer conversion rate. It kept another fraction of a percent, but I still did as well as I could at a currency exchange.
Now, it will add a 3% “foreign currency transaction fee” on top. Back to the Bureau de Change!
Question: Is this a change made at the level of VISA International, or is there bank-to-bank variation? How about MasterCard, AMEX, and Diner’s? I don’t travel that much, but I have learned to count on being able to use my credit card and not worry about conversion charges. Is that over with?