The Navigator: Banks, airlines deserve no credit for card tricks
On second thought, maybe you should leave home without it.
For years, I've been telling travelers to pay with plastic and so have my buddies in the vacation punditry business.
Credit cards protect you from unscrupulous travel agents and tour operators. They hold companies accountable for substandard cruises, flights and hotel rooms. Plus, you can rack up more frequent-flier miles than you'll ever be able to spend.
But what if the very payment system everyone swears by was quietly helping itself to your money, a few bucks at a time, when you travel? What if companies were quietly tacking new fees onto your bill when you were away?
No need to imagine. Let me introduce you to two fast-growing credit card surcharges: the foreign transaction fee and the airline ticket convenience fee.
The foreign transaction fee charges a flat rate -- usually 2 or 3 percent -- of any purchase that takes place with a non-U.S. company, regardless of your location or currency. In other words, you can buy a trip right here in the U. S. of A., pay in greenbacks and still get smacked with a foreign transaction fee.
For example, I heard from a reader a few weeks ago who booked her honeymoon in Canada through a U.S. travel agency. She paid in American dollars, but when she returned from her vacation, she found a surprise $310 foreign transaction fee on her credit card bill. Turns out she'd paid a Canadian company through her agent, incurring the surcharge.
To her, the fee represented nothing less than a money grab. Her bank did nothing to earn it and didn't even bother to warn her before she made the purchase.
Remarkably, this case was easily solved. The newlyweds contacted their bank, and it promptly refunded its share of the fee.
I've seen that happen more than a few times lately. Many banks and credit card companies are rolling over when confronted with questions about these surcharges, which suggests that they know the fees are both exorbitant and inexcusable.
They should really know better. A few years ago, angry customers filed a class-action lawsuit against Visa, MasterCard, their member banks and Diners Club, claiming that they'd conspired to set and conceal a 1 to 3 percent currency conversion fee. That fee applied only to transactions where dollars had to be converted. The case was settled.