If you’re a UK resident planning to use your American Express card for purchases or transactions outside of the UK, it’s important to be aware of the foreign transaction fees that may apply.
Foreign Transaction Fees
American Express charges a foreign transaction fee of 2.99% on all purchases made in a foreign currency. This fee is in addition to the exchange rate used to convert the transaction into GBP.
For example, if you make a purchase of 100 Euros with your American Express card and the exchange rate at the time is 1 GBP = 1.15 Euros, the transaction will be converted to £86.96 GBP. However, with the 2.99% foreign transaction fee, you will actually be charged £89.56 GBP for the purchase.
Avoiding Foreign Transaction Fees
While the foreign transaction fee may be unavoidable when using your American Express card abroad, there are a few ways to minimize the impact:
- Use a card with no foreign transaction fees: If you plan to travel frequently or make a lot of purchases in a foreign currency, it may be worth considering a credit card that doesn’t charge foreign transaction fees. Some American Express cards, such as the Platinum Card and the Preferred Rewards Gold Card, offer this benefit.
- Pay in the local currency: When using your American Express card for purchases abroad, you may be given the option to pay in your home currency or the local currency. Always choose to pay in the local currency to avoid additional fees.
- Plan ahead: If you know you’ll be traveling or making a purchase in a foreign currency, try to plan ahead and make the purchase when the exchange rate is favorable.
Conclusion
American Express charges a foreign transaction fee of 2.99% on all purchases made in a foreign currency, including transactions made outside of the UK. While this fee may be unavoidable, there are ways to minimize its impact, such as using a card with no foreign transaction fees, paying in the local currency, and planning ahead. Be sure to factor in the foreign transaction fee when budgeting for your trip or purchase abroad to avoid any surprises on your credit card statement.