# Pesky "Foreign Transaction" Fees



## mrbobo (Dec 11, 2014)

I am curious how everyone handles credit cards after moving to the Philippines. I moved to the Philippines in July from the US (Las Vegas). I hold a Visa card issued by a US bank and an American Express card issued in the US. I noticed that American Express is whacking me with a 2% foreign transaction fee every time I use their card and Visa is whacking me with a 1% foreign transaction fee when I use theirs. This really irks me. Come on folks, aren't we living in a "global" economy? Why don't the politicians step up to the plate and stop these greedy bankers from lining their pockets with my hard earned cash? Do I need to acquire a Visa from a Philippine bank to avoid these pesky fees? What are the pros and cons? I really don't want another credit card. I now that 1 or 2 percent doesn't sound like much but if you buy a 1000 dollar airplane ticket with your American Express card the greedy sons of "you know what" are whacking you with a needless 20 dollar fee on top of the ridiculous interest rates they already charge! Thanks forum for letting me vent!


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## M.C.A. (Feb 24, 2013)

I got stuck for decades with money transaction, money ex-changer fee's and then the dollar dropped to 39 peso's and with the money ex-changer fee I was getting 35 peso's to the dollar, that was the final straw for me and I opened up a dollar account at a Philippine bank, the savings was enormous.

On the flip side, waiting a month for your check to clear is a pain.


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## Asian Spirit (Mar 1, 2010)

I quit using US banks when I moved here years ago. Our deposits, including my wife's pay check from working here in the Philippines goes into our peso acct. US Social Security of mine goes into a US dollar acct and I transfer it each month into the peso acct as well.

No more credit cards at all. We use a debit card to access the funds when needed or to purchase goods when at the mall etc. Have never had a problem or issue of any kind and even pay some bills online with it. If we use an ATM from a bank other than our own, the service charge is only twenty (20) cents! Not a bad deal at all.
Even our two youngest daughters (10 & 13yrs old) each have their own ATM card so they can get use to and learn banking.


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## mrbobo (Dec 11, 2014)

Jet Lag,

Is you Social Security check being deposited into a US bank like mine? If so, is there a bank fee to transfer from the US bank to your peso account? 

thanks


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## Asian Spirit (Mar 1, 2010)

mrbobo said:


> Jet Lag,
> 
> Is you Social Security check being deposited into a US bank like mine? If so, is there a bank fee to transfer from the US bank to your peso account?
> 
> thanks


No, the Social Security is direct deposited to the bank here in the Philippines and no fee is charged. That's the reason for the dollar account. Living in the Philippines, your spouse, even if American, can not access your Social Security acct - by US law. So I simply transfer the social into our joint peso acct so we all have access and use of it.

That law though is in place because in the past, guys would be thinking with "the wrong head". Get married, and then wind up dead once the wife had access to the $$$.


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## jon1 (Mar 18, 2012)

mcalleyboy said:


> On the flip side, waiting a month for your check to clear is a pain.


I learned quickly about the transaction fees my first year (International and Conversion Fee plus the local bank fee of 200p). 

Writing a check for deposit is the only way to avoid fees and move the money yourself. The first month can be rough if you have a tight budget. But afterwards it is not that big of a deal. You just have to plan ahead a little bit. 

As Jet referred to, if you get a local USD account, you can have the SS deposited in it directly if it is on the approved bank list.


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## M.C.A. (Feb 24, 2013)

*Philippine Banks the way to go*



jon1 said:


> I learned quickly about the transaction fees my first year (International and Conversion Fee plus the local bank fee of 200p).
> 
> Writing a check for deposit is the only way to avoid fees and move the money yourself. The first month can be rough if you have a tight budget. But afterwards it is not that big of a deal. You just have to plan ahead a little bit.
> 
> As Jet referred to, if you get a local USD account, you can have the SS deposited in it directly if it is on the approved bank list.


Jon, my wife lived here (I was still working in the states) and I kept asking her to open up an bank account, she wouldn't do it or it was such a hassle? Anyway after my first year living here I could see that I was losing about $200 a month in money changer fee's.... My wife was still a little angry that I had to deposit $500, I pointed out to her that in a couple months we get our money back so it don't matter, she finally agree'd, good thing I don't allow her to run finances it's tough as it is but....yea my wife doesn't understand a budget, neither does any of her family members, seriously I'm not blessed like some of the expats here, money can evaporate in minutes if I don't budget it and then to throw it away to money changers.....pointless and insane.

I've thought about the pension/retired deposit option but I think my bank does charge a transaction fee of $5-10 but sure beats writing checks, dealing with ATM fee's, waiting periods.


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## esv1226 (Mar 13, 2014)

There are credit cards issued in USA that do not charge foreign exchange fees. I have one and I've been using it here and whenever we travel. 
I have ATM cards (php and usd) issued by our local bank, but no credit card. The banks do not readily issue credit cards to foreigners. 
I can also use my USA bank ATM here, however there's a fee - I have never been tempted to use it.


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## galactic (Dec 2, 2014)

I used to have US based credit and debit cards which had the Foreign Trasaction fees waived on purchases.
But for cash withdrawals there is no way around the foreign transact fees.
Better open up a local dollar account and apply for Philippine based credit cards.


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## HondaGuy (Aug 6, 2012)

For most purchases at reputable retailers (SM, Robinsons, etc), I use a Capital One Visa card or a Chase British Airways Visa card that doesn't charge any Foreign Transaction Fees.

For cash, writing a check from your US bank to your PI Dollar Account seems to be the cheapest, but takes the longest for the cash to arrive. Some guys use Xoom but I haven't tried that yet.

Also, if you have an HSBC USA checking/savings account, you can use your HSBC USA ATM card at an HSBC ATM in the Philippines and HSBC doesn't charge foreign transaction fees there. The exchange rate was also fair and not extortionate.


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## pagbati (Apr 9, 2014)

galactic said:


> I used to have US based credit and debit cards which had the Foreign Trasaction fees waived on purchases.
> But for cash withdrawals there is no way around the foreign transact fees.
> Better open up a local dollar account and apply for Philippine based credit cards.


Galactic, I get the concept that having a local bank is essential and we always do that wherever we live. Re the local bank you're using for Philippine-based credit cards, is there a specific amount that the bank requires to be maintained in the account or is it all based on income/ outgoings? Also, do they require a regular monthly income or do they accept block transfers in, irrelevant of how regular so long as 'sufficient' funds are in the account? I'd appreciate any advice you have on this. Thanks


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## HondaGuy (Aug 6, 2012)

My BDO branch does require a minimum balance on my accounts:

USD Savings Minimum Balance $500
Peso Savings Minimum Balance p2000
Peso Checking Minimum Balance p10000

Your mileage may vary.


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## pagbati (Apr 9, 2014)

HondaGuy said:


> My BDO branch does require a minimum balance on my accounts:
> 
> USD Savings Minimum Balance $500
> Peso Savings Minimum Balance p2000
> ...


Thanks HondaGuy. Are there any other pros and cons you or anyone else would care to share about banking with BDO or other local banks for that matter? I'm randomly collating info about local banks in the Philippines so I can make an informed decision later on about which one to bank with. Maybe it's even sensible to bank with two different local banks? The sort of things we include in our considerations are the quality of customer service, whether or not they have a good, easy to use, online banking system for online international transfers, hidden costs and fees, charges to use their card at other banks' ATM's, availability of ATM's, transfer fees, that sort of thing. All comments appreciated, thanks.


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## M.C.A. (Feb 24, 2013)

*Philippine Banks locations not all equal*



mabrouk said:


> Thanks HondaGuy. Are there any other pros and cons you or anyone else would care to share about banking with BDO or other local banks for that matter? I'm randomly collating info about local banks in the Philippines so I can make an informed decision later on about which one to bank with. Maybe it's even sensible to bank with two different local banks? The sort of things we include in our considerations are the quality of customer service, whether or not they have a good, easy to use, online banking system for online international transfers, hidden costs and fees, charges to use their card at other banks' ATM's, availability of ATM's, transfer fees, that sort of thing. All comments appreciated, thanks.


You might want to visit the banks in the area you plan on living in, not all locations are equal and make sure you have plenty of savings so you won't have to show up on the first day of the month (wish I'd saved). 

I thought about switching to BDO but man that bank in my area is really crowded on the first of the month so I decided to deposit my check once again with PNB, the bank I've been using and I was in and out of there in 20 minutes, tipped the guards, they slip me a lower number...Lol, another positive is that the PNB banks have compounds so you can drive in and park car, security outside and inside, plenty of spots to sit inside the bank also, BDO was standing room only.

Good idea to check out all aspects of banking here, I guess I got lucky on the first try, some banks are linked so you can use any branch to withdraw your money.


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## HondaGuy (Aug 6, 2012)

I just tried Xoom yesterday and sent $100 from my USAA checking account BDO Peso checking account.

The fee was $4.99 for any amount up to $2999. The exchange rate was p43.25 compared to p44.47 at Oanda.com.
The transfer was approved almost immediately and the money was in my BDO account within minutes.

I wouldnt use Xoom on a regular basis, but it is useful for sending money immediately without having to schlep down to a Western Union or other remitter. I can definitely see a newly arrived expat using it for a month or two until their paper checks start clearing or their Social Security shows up in their dollar accounts.


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## HondaGuy (Aug 6, 2012)

I also agree with what mcalleyboy recommends. When you find out where you're going to be spending most of your time, check out different branches of different banks and get a feel for the security, the amount of business at each branch and the customer service (or lack thereof).

Also, since branch managers have a lot of leeway with their branches, it wouldn't hurt to introduce yourself and talk with them about how much money you will be depositing with them and how much you expect to move through there each month. I know a guy who is on very good terms with his branch manager at BDO and she often calls him with special offers and deals that arent available to the general public.


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## Nickleback99 (Aug 6, 2011)

mabrouk said:


> Thanks HondaGuy. Are there any other pros and cons you or anyone else would care to share about banking with BDO or other local banks for that matter? I'm randomly collating info about local banks in the Philippines so I can make an informed decision later on about which one to bank with. Maybe it's even sensible to bank with two different local banks? The sort of things we include in our considerations are the quality of customer service, whether or not they have a good, easy to use, online banking system for online international transfers, hidden costs and fees, charges to use their card at other banks' ATM's, availability of ATM's, transfer fees, that sort of thing. All comments appreciated, thanks.


Another thing to consider is that Wells Fargo links to and PNB, BDO, Metro Bank and BPI, and you can remit from your WF acct in US to your PI based account on WF Express Send, or someone elses (wife's) which I used to do when we were living apart. I believe the transaction fee is only , but there's also a margin in the transaction so that the exchange may not be as much as some others (that I have no idea). When I did to my wife's PNB acct, it always took about 3 days to be available in her account as only drawback, compared to something like Xoom. $3000 daily limit. $1,000 today is at 43.75 exchange rate plus a $5 fee. 3000 at 43.78 and $5 fee. So, could send yourself money 1x per month if planning well for only $5 and then withdraw locally at no cost. My WF account is free as long as I auto transfer $75 per month into a savings acct. All in all, pretty good deal.


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## Asian Spirit (Mar 1, 2010)

mcalleyboy said:


> You might want to visit the banks in the area you plan on living in, not all locations are equal and make sure you have plenty of savings so you won't have to show up on the first day of the month (wish I'd saved).
> 
> I thought about switching to BDO but man that bank in my area is really crowded on the first of the month so I decided to deposit my check once again with PNB, the bank I've been using and I was in and out of there in 20 minutes, tipped the guards, they slip me a lower number...Lol, another positive is that the PNB banks have compounds so you can drive in and park car, security outside and inside, plenty of spots to sit inside the bank also, BDO was standing room only.
> 
> Good idea to check out all aspects of banking here, I guess I got lucky on the first try, some banks are linked so you can use any branch to withdraw your money.


Exactly right--all branches of any bank may or may not be equal in different locations.

At the same time, the two best local banks I know of is China-bank and Metrobank. Good, friendly, fast, and honest service.

But if collecting US Social Security and ya want it direct deposited to a local bank then Metrobank is the one to use.
Reason being is that the US Treasury moves the money (generally) on the 3rd of each month. Metrobank has a huge branch in New York City and the money is moved to that location. So that makes it the 4th of the month here and the money is in the bank. Also, there is no transfer fee either.

Other banks can take even up to the 10th or 12th to have your Social Security deposit available..


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## esv1226 (Mar 13, 2014)

We mostly bank with BPI. Get to know the bank manager and when you become a preferred customer; no need to queue, you get quicker, perhaps better service. I chose BPI then because I believe they have the most number of branches/ATMs conveniently located so I don't have to carry a lot of cash. But I also considered ease and cost of transfering monies.


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## Manitoba (Jun 25, 2014)

Best I found was a remittance company. worldremit.com is the one I used. The fees were reasonable and exchange rate was OK and transfer was quick.

Limits were $cdn 995 per transaction and 6 times that as daily limit.

Downside was no credit card usage just cash.

YMMV with different on line remittance companies or from different source countries.


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## Gary D (Oct 28, 2013)

Manitoba said:


> Best I found was a remittance company. worldremit.com is the one I used. The fees were reasonable and exchange rate was OK and transfer was quick.
> 
> Limits were $cdn 995 per transaction and 6 times that as daily limit.
> 
> ...


Worldremit is also my wife company of choice to send money to the family. They can usually pick up the money within hours of us sending it from the UK.


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## JShannon (Jan 28, 2014)

In Canada there is a company called Forex, you sign in, select the amount you want to transfer, it gives you the exchange rate they offer for the day. If you like the rate you can set up the transfer on the spot at the price quoted. They change it into pesos and that is what is sent. 

For less than $10k it costs $5, over that is free. I looked at what Metrobank converts it at when CAD are sent here, get about 3 pesos a $ less than exchanging it on the other end and sending it. In Canada my PCF and TD bank both charge $30 a pop to send money here so I will be using Forex.

Might be a similar company in the States.


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## Manitoba (Jun 25, 2014)

Gary D said:


> Worldremit is also my wife company of choice to send money to the family. They can usually pick up the money within hours of us sending it from the UK.


I have sent myself cash from my smartphone app and picked up in less than an hour.

BTW I use a VPN application everytime I transfer money period.


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## mharrich (Aug 4, 2013)

Check out credit card issued by airline companies. For example, I use a US Bank issued Korean Air VISA card with no foreign transaction fees. There is an annual fee for the card with a few perks that make it a useful card for me.


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