Some credit cards are more widely accepted around the world than others. Discover Card, Diner’s Club and others that have far smaller networks outside of the U.S. may not be a viable option when traveling internationally. While Visa is typically accepted globally, MasterCard and American Express are notalways accepted.
While a merchant might accept a card, there are times when they have higher limits than one might expect from the U.S. and often, if the clerk does not want to work the terminal, he may indicate it is “out of order”.
It’s also easy to forget that in some nations, such as Italy, it is common for businesses to accept only cash in local currency, especially for smaller purchases.
Strategies for Credit Card Usage Abroad
Employees should check to ensure they can use ATMs and debit/credit cards to withdraw money in the host country and what fees will be charged for using them—before they leave!
Often, using foreign cards will mean charges on both ends of the transaction and many do not realize that the vast majority of credit cards charge a foreign transaction fee of 1-to-3% of the purchase price for every purchase made abroad. If fees are high, employees should consider the potential of securing a credit card with lower fees before the move/assignment.
Credit card fraud is rampant amongst international transactions. Often the cards can be “frozen” and one has to speak with the card’s customer service department to release a hold on the card. A card that worked twenty minutes ago may no longer work because a fraud alert has been placed on it. A simple solution is to carry several credit cards to increase your options—especially at the beginning of an assignment.
It may also be more difficult to obtain a credit card from a local host country bank. If one’s credit history in the home country will not transfer to the host country, the employee could be considered a high risk customer by the local bank and, if approved at all, pay higher interest rates. It may prove worthwhile to use a known, global bank with a worldwide presence that can relay credit history data to their host country branch.
Chip and PIN card readers are the standard in most overseas locations. Travelers may have trouble using cards that are not equipped with chip and PIN technology.
As any good Boy Scout will tell you, “Be prepared!” Exploring your options before you travel abroad can certainly prepare you for situations that you may encounter—and it will probably save you some money.
Knowing what to expect so you can have a backup plan when faced with challenging situations can alleviate a lot of frustration. Lastly, carrying local currency should always work as a last resort.