Reducing Hidden ATM Conversion Fees
Avoid something called Dynamic Currency Conversion (DCC)
Some ATMs may recommend you the choice of paying in your home currency. This option is called Dynamic Currency Conversion. Avoid private owned ATM machines, such as Travelex, Euronet, Moneybox, Cardpoint, and Cashzone. They charge high and may try to catch users with “dynamic currency conversion.” Note that these “autonomous” ATMs are often found next to bank ATMs in the hope that travellers will be too distracted to notice the difference.
When you accept or choose DCC, you’re giving the foreign ATM merchant authorisation to do the currency conversion on your behalf. You’re essentially asking an overseas ATM provider to make up an exchange rate for you. If you choice to pay in the local currency, then this means your home bank will be in charge for the currency conversion. The banks give their clients fair exchange rates on these transactions.
While it’s never a good idea to travel with more cash on hand, you can avoid regular ATM fees by withdrawing large amounts of local currency at one time.
Pick a bank in the Global ATM Network
A large network of banks have come together and waives international withdrawal fees. When you’re travelling abroad, you can find a friendly ATM on nearly every continent. Participating banks include Bank of America, Scotiabank, Barclays and Deutsche Bank.
Each bank uses the system differently, which means some banks give up more of the fees than others. For example, Bank of America still charges a 3% conversion fee. Scotiabank is more liberal, and waive all ATM fees and access fees. So be sure to speak to your bank before leaving on your trip.
Find a low-fee card
Some banks charge fewer fees than others. For example, HSBC has ATMs around the world and charges $2.50 per ATM transaction, even at non-HSBC ATMs. The Capital One doesn’t charge any withdrawal fees, but the local bank will still likely charge you. With enough research, you can find cards that suit your travel needs; some are better than others.