THE BRIEF · CARDS
The 2.5% foreign exchange fee is written nowhere
They do not appear as a separate line. They are folded into the rate shown, transaction by transaction — which makes them impossible to see and easy to pay.
By the Yoseri News desk · · 2 min read
You pay €100 abroad. The statement shows $149.50. You assume that was the day’s rate. The day’s rate gave $145.85.
The difference — $3.65 — is your card’s conversion fee, here 2.5%. It does not appear as a separate line: it is multiplied into the rate before the line is written. The network converts at 1.4585, the card bills at 1.4950, and the statement only shows the result.
That is what makes this fee unlike every other one you pay. A $3.65 monthly charge, you would eventually see. Folded into two hundred lines of a trip, you never do.
On a trip where you spend $3,000, the 2.5% costs you $75 — without a single line item carrying that name.
Two more traps sit on top of the first. A cash withdrawal abroad is a cash advance: no grace period, interest from day one, plus a flat fee. And the conversion offered by the terminal — “would you like to pay in Canadian dollars?” — adds its own margin on top of the card’s. Answer “no, in local currency”: you leave the conversion to the network, which costs you less.
Yoseri’s Subscriptions page also spots recurring charges billed in a foreign currency: those pay the fee every month, with no trip involved.
Where the figures come from
The maths in this article starts from the assumptions written above. Run them again with your own figures — you should land on the same numbers.
Yoseri News is an educational publication. Nothing in this article is investment advice, a recommendation to buy or sell, or tax advice. Yoseri is registered as neither an adviser nor a dealer with any market authority.