Plastic Problems

[VivreManger]

Thanks for the practical advice given before my trip.

Have any of you had problems with using ATM and credit cards in Europe recently? I just got back from Paris and Lausanne and had repeated but inconsistent problems in using both my cards.

In a small store in Lausanne my Visa card was rejected, but my Mastercard worked. Phone booths in Switzerland allow credit card use without any extra charge. The phone booths in rail stations do what they claim. They work, but the phones in the post office and elsewhere do not. In those instances I tried both Visa and Mastercharge. In Paris I had similar inconsistencies in shops and restaurants. At Petit Marguery, after trying the Visa and Mastercard without success, the American Express worked.

I realize that with increasingly intrusive security procedures, credit card companies will sometime hold approval when the usage pattern is unusual, but these cases were far too inconsistent to suggest a design at work.

The other problem concerns bank ATM cards. The ATM in terminal 2 C, arrival just to the right of the information booth, run by Union des Banques de Paris (??) would not accept my Cirrus-linked bankcard. That same day I had trouble at Bank Lyonnaise and one or two others, but eventually I got a Barclaysbank ATM to work for me. A few days later, I succeeded with a Bred (?) ATM.

In all my trips to Europe I have never had so many problems with plastic. In the past, there might be general problems such as the armored car drivers strike in France or Italian ATM slow-downs on weekends, but now the trouble seems more widespread and erratic. Any similar complaints?

The solution might have been before departure to alert the banks and credit card companies to travel plans, but I suspect something more that that is causing the trouble.

Edited December 6, 2002 by VivreManger (log)

[cabrales]

More than two years ago, I learned from Citibank that only passwords for ATMs that have four or fewer digits work in Europe. I don't know if that remains the case. My card works whereever there is the "Cirrus" logo, and that is about almost everywhere.

I do not utiilze credit cards for phones in France. I find that charges are not entirely predictable, and I usually buy the Telecarte (which is a bit expensive per minute to some places, but which at least is transparent with respect to charges). I also buy other phone cards that can be utilized in hotels and at other phones.

I have not yet purchased a local "chip" for my GSM mobile phone, but that appears to be a promising avenue.

[VivreManger]

My ATM password follows that rule, yet I still had trouble. I wonder if my home bank has screwed up. In France I use a Telecarte, but I was not in Switzerland long enough to buy theirs. Unlike French phones, Swiss proclaim no extra charge for credit care usage. That remains to be seen when the bill comes.

[Rail Paul]

I asked my US bank if I'd have any problems with my new Visa card in Europe prior to my last trip.

Fleet Bank told me that the card (with a four character password) was fine. More than four characters will not work on some the networks in Europe. A few (RaboBank comes to mind) will accept five or more characters, though. Fleet also reset one of their fraud parameters which is supposed to flag unusual purchases or locations.

It's also possible that your issuing bank does not participate in the protocols used by the European "switches" which verify non-host bank transactions at ATMs. If that's the case, the ATM doesn't pass the transaction. By using a different bank's machine, with a different switch, the problem is eliminated.

[cabrales]

I usually use AmEx, but I still keep a Visa and a Mastercard around for use in Europe (particularly the Visa).

[MsRamsey]

In 1997, while I could get money out of ATMs in tiny villages in Wales, I could get NOTHING in Paris. My ATM card had several of the internationally recognized symbols, such as STAR and Cirrus, and I had procured an list from my home bank with bank addresses in Paris where I could supposedly use ATMs successfully. No luck at all. I even called my US bank from Paris, but what could they do, really?

[Margaret Pilgrim]

Yes, we had two small misadventures in October.

The first occurred when our major credit card was refused after dinner one night. My husband called the number provided by the card company (a collect number was the only one provided, and making a collect call from France around midnight is, in itself, an interesting story), and was told that the account had been frozen because of a flurry of activity outside our residential area. We were advised to always notify them that we are travelling in order to prevent such disruption of service. This precaution is new, since for many years this same card issuer has relied on our predictable travel to a half dozen locales to make distinctions in fraudulent card use.

The second problem occurred when an ATM machine ate my brokerage debit card. It appears that a previous customer had a problem that the machine had not finished digesting. It took me several hours to get my card back, a situation that would have been very troublesome had we been catching a plane or train shortly.

[cabrales]

I haven't paid attention to this, but are exchange rates and service charges reasonable when US ATM cards are utilized in France?

[Dave the Cook]

I haven't paid attention to this, but are exchange rates and service charges reasonable when US ATM cards are utilized in France? 

I haven't been in several years, but my recollection is that while the exchange rates were as good as you could get, the service charges (which will very from bank to bank) were atrocious. Since they included a hefty flat fee, it was very much in your best interest to withdraw a lot of money rather than several smaller transactions.

[Margaret Pilgrim]

Cabrales, I'm looking at my last statement, and note that the three 500 euro withdrawals that have come through so far were charged at 496.84, 499.50 and 499.50. This was at a time when the dollar and euro were dancing around parity. There may be better exchanges out there, but adding in convenience, these rates of exchange are good enough for me to continue using this card at an ATM.

[cabrales]

Margaret -- Those exchange rates are very good. By the way, I believe two of the best "bureau de change" in Paris are (1) the two Paris Vision stores, including one very close to the place near L'Opera where Roissybus drops passengers off from CDG, and (2) a single bureau de change in a shopping mall on the Champs Elysees (forget the name; members beware, others are very expensive).

Members should be careful about commissions charges on top of the posted rate. At Paris Vision, there are no additional commissions charges, and the buy and sell rate for USD cash generally provide a relatively low spread.

[Rail Paul]

Cabrales, I'm looking at my last statement, and note that the three 500 euro withdrawals that have come through so far were charged at 496.84, 499.50 and 499.50.  This was at a time when the dollar and euro were dancing around parity.  There may be better exchanges out there, but adding in convenience, these rates of exchange are good enough for me to continue using this card at an ATM.

American Express and the major bank cards use the wholesale (bank to bank) exchange rate for Euro to dollar or vice versa. I noticed that several recent Irish transactions had different exchange rates during the same day, which suggests immediate clearing, rather than batching them for an overnight exchange.

I'd be very surprised if an individual would be able to obtain a better rate.

[Bux]

Members should be careful about commissions charges on top of the posted rate. At Paris Vision, there are no additional commissions charges, and the buy and sell rate for USD cash generally provide a relatively low spread.

This is long. Please bear with me if this subject is of interest.

We have become totally reliant on ATMs and credit cards. I can't remember the last time I've used a currency exchange service of any kind. I take that back. It was in mainland China some years back. Hong Kong and Japan had reasonably friendly ATMs. In the past decade or so of traveling in Europe, I've only been in London, France, Spain and Belgium and found ATMs perfectly serviceable, although the Belgian machines were not nearly as easy to find as they were in France or Spain. The last time I had a problem was when my bank was off line in Spain and I had to use a credit card to get a few bucks to eat in a little restaurant that didn't take credit cards. One should never travel with less than twenty dollars of local currency in one's pocket anyway. That was my fault.

Those who know me well, should also know that I use my ATM card, not for the incredible convenience, but because it's the least expensive way to get local currency. At one point, every ATM card offered a better rate than every change booth or bank counter in France. Banks have gotten wise to this and have started to add all sorts of charges and surcharges lest they didn't make enough on the first round. Shop around. In the NY area, HSBC offers both credit cards and ATM cards with no surcharges for foreign currency so that all you pay is the 1% over the interbank rate charged by Visa or Cirrus (MasterCard) If you have your own bank and are exchanging millions of dollars a day, you can beat that. Otherwise not.

Net banks, without ATMs of their own, often do not charge any fees for ATM use since they don't incur any fees. Many banks will have a fee based on the nature of your account and the minimum balance required. Look for the account that has unlimited foreign ATM use and see if the balance is acceptable. Interest rates are negligible these days, but some banks will let you combine a money market or investment account to meet the minimum balance requirements. Credit Unions usually offer a card with no fees or charges, but you should check each agreement carefully.

In addition to the fees, over the past two years most banks have added a "foreign currency conversion 'surcharge.'" You need to understand that when the consumer with a US bank card makes a withdrawal or purchase using an ATM, debit or credit card, Visa or Cirrus (MasterCard) handle the conversion at the interbank rate. For this service, they take 1%. That's very fair and a bargain to the consumer used to over the counter exchanges. Your bank does not deal in the foreign currency. Visa or Cirrus deal only in dollar transactions with them and in euros with the French bank. So why are banks adding a conversion surcharge? I suggest it's because they can get away with if from most account holders who travel aborad only on occasion and who don't see the surcharge on their bills. The surcharge is incorporated into the exchange rate shown on your statement. As the exchange rate fluctuates all the time, most consumers will not pay much attention to the difference between 1.0092, 1.0192, 1.0292 or 1.0392. You withdrew a hundred euros and you knew it would cost a bit more than $100. $103.92 will sound reasonable and you don't know I'm getting charged $101.92 for the same 100 euros. Notice of this surcharge, usually about 2%, (some banks charge more) should be found in the small print of the agreement that comes with the card.

Bear in mind that banks lie, possibly though ignorance of what they are doing. Some years back, I received a notice from my bank saying I would be charged a 2% surcharge on my credit card. I called and asked if that would apply to my ATM card as well. I was told "No." I therefore paid for my next trip abroad using my debit card rather than my credit card, losing the interest on the float, but feeling had saved close to 2% of the trip's cost. Subsequently, I realized how dependant I was on my ATM card and opened an account at another bank for the sole purpose of having a back up card. As a lark on my next trip, I withdrew 100 francs in rapid succession from the same ATM using both cards. When I returned home, I checked my statments and found I had been charged exactly 2% more by my old bank. I informed my bank. They said I must be mistaken, they could't imagine how that happened and they sent me twenty dollars for my "trouble." I quickly switched most of my business to the new bank.

I found the whole thing rather offensive, but I managed to do some research into this business and Visa was quite up front in telling me that they take 1% for themselves and allow their member banks to have them build in extra points which are credited to the bank. So when your bank tells you that the add nothing to what Visa (or Cirrus) charges, they are technically accurate, but misleading. Cirrus was far more circumspect about what they would tell me over the phone, but it appeared as if they had the same policies. Caveat emptor. If you travel a lot, you may have just saved the cost of membership here. If you travel a lot and live well when you are traveling and this is all news to you, you have saved enough to buy me a good dinner.