Editorial Policy

Don’t let foreign charges trip you up

Allie Johnson

February 26, 2014

When I’m making credit card purchases online, it’s usually from Amazon.com or another U.S.-based retailer. But I recently made a few international purchases online, and it got me wondering about the ins and outs of using credit cards with international online merchants.

In the past few months, I bought lace window privacy film from a British home goods retailer. I also purchased earrings from an Etsy.com shop in Turkey. And, I got some records from a seller in Spain as a present for my husband. I used my Capital One card, mostly because it’s my go-to card. I also like that it doesn’t charge foreign transaction fees, which can be up to 3 percent when you make purchases outside the United States.

To prevent any foreign purchasing snags or fees, here are some things to know when making a purchase from an online retailer in another country:

1. Let your card issuer know about the purchase. An online purchase from a retailer in another country could trigger a fraud alert, according to Linda Sherry, director of national priorities for Consumer Action. Worst case scenario: You are declined next time you buy groceries or gas, although your issuer might simply call you to make sure the charge is valid, Sherry says.

2. Use a card that doesn’t charge a foreign transaction fee. Many frequent travelers swear by Capital One, which charges no foreign transaction fee and even covers the fee charged by Visa and MasterCard. Other cards, such as Discover It and the Chase Sapphire Preferred Card, advertise no foreign transaction fees.

3. If your card does charge a fee, find out if that applies to online purchases. Your card-issuing bank or credit union might have to pay a fee when you make an international purchase, even online, and might pass that on to you or even charge you more than they pay. For example, Visa charges between 0.15 and 1 percent to its “financial institution partners” for any transactions that require the use of its global payment system, and states that those institutions may decide whether to pass the charge on to their customers. You can check your terms and conditions or call your card issuer for clarification.

4. If you get dinged with a fee, complain. As consumer advocate/journalist Christopher Elliott explains on his blog, your card issuer might refund the fee as a courtesy. That’s what happened to one of Elliott’s readers who got hit with a $27 charge for purchasing an Air Berlin ticket on Expedia.com. Try your card issuer first to see if it will remove the charge. But Elliott’s reader had to file a complaint with the U.S. Department of Treasury through HelpWithMyBank.gov, a site that helps consumers handle issues with their banks. Finally, his issuer removed the fee.

I think if I make more international purchases, I’ll tip my card issuer off ahead of time so it knows the charge is valid. It might not be necessary, but I’ve had my card declined at the grocery store after my issuer caught a fraudulent charge made in Africa. Since it’s no fun being told at the register that your card didn’t work, I’ll definitely take that extra step to avoid that hassle.