How can I avoid bank charges abroad?

It’s often a nasty surprise when you travel: high bank charges. Day-to-day expenses via your bank card, withdrawing money from an ATM, commissions and other charges can add up. Unless you make the right choices!

Bank charges abroad – it’s a jungle!

Between your bank’s commissions, interbank exchange rates and the fees charged by certain ATM operators, using money outside the borders has a cost. However, it is difficult to give precise figures. This is because each bank applies its own charges. Prices are communicated to customers each year, but (too) few check them.

Europe’s banking industry has a common pricing structure

If there’s one area where Europe is united, it’s money and finance. Thanks to the euro and the IBAN, you benefit from (or suffer from) the same charges for all banking services in all European countries.

If your account agreement states that you will not be charged for payments made with your bank card, then the same applies throughout Europe. On the other hand, it is always possible that the local bank (when you are abroad on a holiday or business trip) will charge a fee for cash withdrawals from ATMs. This is often the case in France for withdrawals from competitors’ ATMs. You could be the victim of a double penalty: the addition of the two charges.

Good to know: Transactions in countries that use the euro but are not part of the European Community may be subject to some charges and commissions: Kosovo and Montenegro in particular.

Outside the euro zone: exchange fees and commissions for everyone

Fees and commissions vary from bank to bank. There are therefore 3 sources of charges: fixed charges, commissions and exchange fees.

Very expensive cash!

Banks charge a lot for withdrawing cash abroad. There is a fixed charge – between €2 and €3.5 – and a commission of between 2% and 3% of the amount withdrawn. Add to this the local ATM charges and the bank’s ‘exchange charges’. When it converts foreign currency into euros for withdrawal from your account, your financial ‘partner’ will apply a favourable exchange rate to take a commission. This is an additional cost. It is therefore advisable to make few withdrawals abroad, or only large sums, to reduce the proportion of fixed costs.

A commission for each payment

Generally, when you return from a trip, you see the cost of your expenses outside Europe. By the time the entry has passed through your account, you’re back home. And then there’s a nasty surprise: commission charges multiply (for purchases abroad), as do higher exchange rates. This costs around 2-4% of the amount of each transaction.

‘No-fee’ payment solutions do exist

To avoid ATM operator charges, there is always the option of travelling with cash withdrawn in France. If you want to leave the country with a sum of €10,000 or more, you absolutely must make a customs declaration.

Taking money out of the country is free, but forgetting to declare it can cost up to 50% of the amount. The authorities can even confiscate all undeclared cash.

Obviously, travelling with notes and coins in your luggage is not exactly safe.

Good to know: the authorities consider that all valuables are affected, not just notes and coins. Casino chips, shares, prepaid cards, gold and silver also go through customs if they are valued at 10,000 euros or more.

Fintech offers are cheaper

It’s easy to see that the terms and conditions of online banks are cheaper than those of traditional banks. Even when they are a subsidiary of a systemic bank, payment and withdrawal fees are generally lower.

Some new entrants to the banking world are also playing up these charges to attract new customers. Beware, however, of the finer print of these offers, with different charges for foreign transactions depending on the amount of the subscription. The less you pay in account fees, the more commission you pay.

VeraCash: zero commission, no fees for foreign transactions

At VeraCash, it was settled from the outset that there would be no charges for payments and withdrawals abroad. And as account management is also free, this is undoubtedly one of the most attractive offers on the market.

Worth noting: The VeraCash debit card allows you to withdraw cash from over 2 million ATMs and pay at over 40 million Mastercard network merchants worldwide.

A negotiated interbank exchange rate

There are no hidden costs from VeraCash. We apply the Mastercard exchange rate at the time of payment. A giant in financial exchanges, like Mastercard, benefits from favourable interbank exchange rates. This rate, set in real time, is close to the exchange rate between banks. The world’s second largest payment operator is at the heart of large volumes, and generates numerous commissions for local banks. It can therefore afford to charge an attractive rate for its customers, including those of VeraCash.

Please note: If your transaction has been converted by the merchant or ATM operator, then Mastercard exchange rates will not apply. This usually happens when you choose to pay in the currency of your card rather than that of the merchant or ATM.

With the VeraCash application, you can track your spending and withdrawals in real time in the countries you visit. Travel with true peace of mind!