Rule #1: Pay with your credit card
Paying with the right credit card has many advantages including:
- Cheaper than exchanging cash*
- Cheaper than Maestro debit cards (non-euro countries)
- No need to carry around large amounts of cash
- Possible to dispute transactions with your bank
- Earning miles or points (certain cards)
- Insurance coverage (certain cards)
*Some countries have a black market currency exchange which offers much better rates than the official ones (e.g. Argentina), bringing cash might be a better deal. Also check if credit cards are widely accepted at your travel destination, cash might be the only option to pay.
Rule #2: Choose the right credit card
When selecting a credit card, there are 3 things to keep in mind:
- The annual fee of the credit card
- The conversion fee when paying in foreign currencies
- The cost of withdrawing money
Comparing annual fees is easy, but what most people forget is the conversion fee. When you make a payment in a foreign currency, all banks use the same exchange rate obtained from the ECB (for European cards). But most banks also add a conversion fee (also known as ‘foreign transaction fee’) which may vary from 1% to 3%. Make sure to use a credit card which doesn’t have a conversion fee or at least a card with a low conversion fee.
Rule #3: Pay in the local currency
You might have heard the question before: “Do you want to pay in local currency or your home country currency?” Always decline the offer and make sure you are charged in the local currency! Shops, hotels and restaurants offer this option so they can apply “Dynamic Currency Conversion” which is basically a SCAM. The payment processor will convert the local currency to your home country currency but will add a conversion fee which can be as high as 10%! Much higher than the conversion fee (if any) of your credit card…a nice extra for the hotel, restaurant or merchant. Paying in the local currency is always cheaper.
Withdrawing money from an ATM
In general, credit cards offer a better deal than using a Maestro debit card when withdrawing foreign currency from an ATM. Most credit cards charge an withdrawal fee which may be a fixed amount or a certain percentage of the amount you withdraw. Select a credit card which has no ATM withdrawal fee (or a low one) and don’t forget the conversion fee. Never accept an ATM’s offer to convert the foreign currency to your home country currency, this is the Dynamic Currency Conversion SCAM. Some ATM’s might also charge an additional fixed ATM fee on top. Do your research online and check which banks have no (or low) ATM fees at your travel destination. Finally, if your credit card has a fixed ATM withdrawal fee (e.g. €5) make sure to withdraw all the cash you need for the trip, instead of making multiple smaller withdrawals.
Best credit cards for Belgian travellers
For non-euro payments, I recommend the BKCP Visa Classic (update January 2017: this card is no longer available) and Belfius Mastercard White cards as they offer the lowest fees on the Belgian market. The BKCP Visa card is best for travellers who spend and withdraw foreign currencies several times a year. If you spend less than ~€4000 in foreign currencies per year and don’t withdraw money from ATM’s using your credit card, the Belfius Mastercard might be a cheaper option. Keep in mind you can also use the cards for online purchases in foreign currencies!
BKCP VISA CLASSIC
Annual fee: €19,92 + €37,92* = €57,84
*You need a BKCP account to request the card, annual fees €37,92
Conversion fee: 0%
ATM withdrawal euro-zone: €0
ATM withdrawal outside euro-zone: €5 (+ 0% conversion fee)
BELFIUS MASTERCARD WHITE
Annual fee: €12
Conversion fee: 1%
ATM withdrawal euro-zone: €5
ATM withdrawal outside euro-zone: €5 (+ 1% conversion fee)
BRUSSELS AIRLINES AMERICAN EXPRESS
Annual fee: €120 or €150
Conversion fee: 2,5%
ATM withdrawal euro-zone: 3,5% (min € 5,00)
ATM withdrawal outside euro-zone: 3,5% (+ 2,5% conversion fee)
For euro-payments, I recommend the Brussels Airlines Premium American Express card. As you probably noticed, the conversion fees and ATM withdrawal fees of the American Express cards are insane. You can avoid them by using the card for euro-payments only. There’s also a high annual fee, but this is compensated by a number of insurances which come with the card and the fact your earn valuable miles per euro spent. Applying for the Brussels Airlines Premium American Express card earns 12,000 miles! More details on how to request the card in my Brussels Airlines American Express blog post.
Best Maestro debit card for Belgians
ARGENTA MAESTRO DEBIT CARD
Annual fee: €0
Conversion fee: 0%
ATM withdrawal euro-zone: €0
ATM withdrawal outside euro-zone: €0 (+ 0% conversion fee)
Blog reader Dima highlighted the Argenta Maestro debit card which claims to have no fees at all. I can confirm the card has no annual fee and the linked bank account is free. I’m still a bit skeptical about the free ATM withdrawal outside the euro-zone. I’ll do the test on one of my next trips and withdraw the exact same amount of money from the same ATM at the same time with my BKCP Visa Classic and Argenta Maestro debit cards to compare what I’m being charged in euros. The Argenta Maestro card might be a nice addition to your wallet for non-euro payments and cash withdrawals, but has some disadvantages versus VISA / MasterCard:
- Maestro less accepted than VISA / MasterCard
- No credit, need cash in your account
- Need to unlock account for use in non-EU countries
- Not possible to use card as ‘guarantee’ (e.g. car rental)
- Not possible to dispute transactions with your bank
- Lower limits
Anything to add? Please share your experiences in the comments of this post! Thanks.