International Transaction fees on AUD Transactions

Businesses are utterly entranced by the prospect of making a killing, so don’t get in their way or you will be run over and killed in the rush! This is absolutely reprehensible karen_seager!

We as consumers, Choice magazine and any other consumer protection pressure group, must report these concerns to the ACCC, present your disgust as respectful feedback to the bank flogging your arm, and write emails or letters to politicians and newspapers.

Now get cracking all of you!

I purchased a number of software apps that were to enhance my experience of Windows 10. These were either games, utilities, cooking and various educational apps.

I got stung $7.18 AUD for the many apps that I purchased online, using my Microsoft account on the Microsoft Australia online store. These were all purchased in a fit on or around the 1st September 2016.

Every single price displayed online was in Australian Dollars. I know from past experience that I have never paid international transaction fees through purchasing anything with Microsoft Australia online.

I hate being set upon by bank bullies; in this case it was the CBA altering their credit card terms and conditions at will, as they do with variable interest rates for business loans or mortgages. If only everyone else had such contractual freedom as the banking sector have with the formerly mentioned products!

I suspect that they have told me sometime previously in any of their updates to their terms and conditions, that most of us probably do not read or pay close attention to.

Naughty bastards!

3 Likes

Those fees are a real pain, especially when a company has a local base. Thanks for letting us know @avdbz429.

1 Like

Visa now charge a fee for all overseas transactions regardless of whether the bill was charged in Australian dollars. They claim that it costs them money to pay such transactions to the various vendors which is rot. All it needs is an intrabank transfer. I am sure credit card suppliers are doing this because they can and not because they have to.

3 Likes

I am totally with you @deevo101. I had a similar experience a week ago booking flight tickets at cheapoair.com though it was landing site from flightcomparison sites like lastminuteflight.com.au or iwantthatflight.com.au. As a customer you presume that its Australian site as the fares are displayed in AUD. I reviewed at cheapoair.com for fares and all were in AUD. Even while paying by credit card or anywhere in T&C was it mentioned an Internation txn fee will be charged etc etc. Few days later my credit card txn had amount in AUD plus Int txn fee. I had to call the travel site customer care to explain it and there were good enough to get it refunded back to my card in 14 days. After speaking to customer care I realised the site is operating in NY and charges were in USD but website shows prices in AUD. This is clear deceiving of customers and there should be a mechanism for consumer to have a say.

3 Likes

This may be common knowledge but could help out others looking for a way to avoid these bogus hidden fees. There is one card I know of which has a very competitive exchange rate and does not charge int’l txn fees even for foreign currencies. There is no annual fee either, but you do have to make sure you pay your statement on time in a specific way or else you’ll get hit with their payment fees, late fees etc etc - as with most credit cards.

I should add that I am in no way affiliated with the company issuing this card, and everyone should look into the PDS, critical info summary and other info to ensure the product will meet their individual needs.

https://www.28degreescard.com.au/

Banks have sneaky fees and this is one of them. The amount charged on forex fees is scandalous and people need to start getting credit cards lie the 28 Degrees mastercard (no forex fees and bank currency exchange rates) to convince banks to end the feeding frenzy.
I find the issue you have described as well as the same issue faced by travellers one big rort.

3 Likes

We purchase software online, mainly from America, and our bank charges us this fee. It is a different bank. However, given we are not paying GST it does not bother me and it is always a very minute amount, like under a few dollars. If it were more I guess I’d be screaming.

I started looking around for another credit card after my primary card provider (Citibank) advised a few months ago that they were adding a conversion fee surcharge (about 3 - 3.5%) to overseas purchases, even if they were billed in $AUS.

I agree the 28 Degrees Mastercard is great - it was one of the two previously recommended in CHOICE; there are no annual or transaction fees (except for ATM withdrawals) and the transaction rates are the official Mastercard conversion rates on that day - the other “non-fee” card recommended actually provides a currency conversion rate of about 3 to 3.5 percent lower, so don’t be tempted!

If you are going overseas, or buying overseas from Australia, I recommend you get one of these cards as it will effectively cost you nothing (unless you get cash withdrawals. Aside from using an exchange agent to transfer $AUD overseas, this is probably the best option to use travelling, or just to puchase from any overseas merchant.

1 Like

Amazingly, none of you, including the Choice article, have mentioned the real reason for the banks behaving this way. It’s to counter DCC. (If you don’t know what DCC is, read something like this discussion on Flyertalk.)

Our banking system and many others allow DCC, pretending it will benefit customers, when in practice it does not. The ACCC actually forced DCC to be allowed in Australia, so that the banks can rip off overseas tourists, just the same way we can be ripped off when we go overseas!

That said, the banks here make no attempt to work out which transactions are DCC from overseas and which are Australian retailers using overseas processing. They simply hit everyone with the fee indiscriminately. But you’re never going to get far in solving the problem when you don’t even mention, let alone understand, what causes it.

1 Like

By the way, there is one way to avoid all this. Use American Express.

Amex doesn’t allow DCC and Amex consequently doesn’t charge for foreign transactions in AUD.

2 Likes

The one guarantee when you see an xrate offer pop up on a card terminal for your acceptance when using a foreign issued card in Australia is that it will be by far the worst xrate you could get if you actively sought it out. The banks claim it provides the customer with immediate certainty. That would be immediate certainty of what a bad deal the xrate is. The way it is presented implies if you do not accept the rip off xrate the charge will not go through, even though it will. Many sales people think they have to push “yes” to use the card. Selecting “No” is the smart answer.

1 Like

:open_mouth: Facebook has ads?

Clearly you’re not using uBlock Origin!

1 Like

Thanks for the feedback @craig1, I’ll be sure to pass it on. We have covered DCC in some of our travel articles, but we’re aware this can happen when shopping online too.

I have just seen the posts about 28 Degrees Mastercard, and decided to apply…I have just read the Privacy Document, and it appears to me that they will obtain personal information about you from any source and supply it to any company or person that cares to pay for it. This includes medical information to an insurance company, and possible a con artist in Nigeria. I could be misinterpreting it, but it certainly looks that way.

Same. Just bought something on Amazon in AUD and got charged a $3 international transaction fee. I don’t get it🤔

But is it any different from any other credit card or credit arrangement? Or even most apps on your smart phone? - they all require you to almost sign your life away.

If you value your privacy, don’t use any electronic methods of financial transaction and just use cash!

Hi Albie,

I’m not sure what you are saying “same” to, but please read my posts about credit cards and fees. Your credit card probably says that they can charge you for international transactions even if they are in $AUD.

I believe CHOICE should look into the “International Transaction Fees” issue, especially when the charges are in $AUD; and particularly when my CC bank states that “It may not always be clear that the merchant or its financial institution/payment processor is located outside Australia.”

I think these fees may be illegal, just as other bank fees have been found to be. But I’m not a lawyer.

1 Like

This is one of the classics about EULAs that virtually nobody reads -

Same is an abbreviated way of saying “I have had a similar experience”