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Spending your dollars in France

Sarastro — Sun, 10 Apr 2011 15:40:20 +0000

Here is a brief rundown about your options for spending in Euros:

ATMs

1. French banks do not add any fee of any kind to withdraw from their ATMs.

2. There will be a currency conversion fee of 1% charged by the network handling the transaction, typically Sirrus or Maestro or some other entity. It should be noted that Visa and MC own Sirrus and Maestro.

3. Your local bank might add additional fees as a percentage of the transaction and/or a fixed fee. Bank of America charges a conversion fee and $5 per transaction which is one of the highest foreign ATM user costs of any bank in the USA. They then throw their customers a bone by not charging the fixed fee on withdrawals from BNP but many, many credit unions and smaller banks only pass along the currency conversion fee with no fixed fee no matter from where withdrawals are made.

Credit Cards

1. Merchants or their banks do not charge the customer for credit card use.

2. Visa or MC charge a 1% currency conversion fee on all charges made outside of the USA (excluding its territories or military installations) regardless of the currency used in the transaction. Accepting a Dynamic Currency Conversion transaction does not avoid the conversion fee.

3. Banks may add an additional 2% if for no other reason than they can. TD Bank, Capital One, Navy FCU, or some credit unions actually absorb the 1% currency conversion fee. Bank of America, Wells Fargo, Citicorp and other large banks charge 3% (1% currency conversion + 2% in house) on foreign transactions. American Express charges 2.7%. It is a fundamental misstatement to conclude that Almost all US banks now add a 3% “conversion fee”. There are many banks and credit unions which do not add transaction fees and only pass along the currency conversion fee. USAA is a large bank which only passes along the 1% conversion fee but adds no additional costs to foreign transactions. Savvy consumers inquire about these fees before opening a bank account anywhere.

Travelers Cheques

These are almost impossible to cash and may involve degraded exchange rates. Pre loaded ATM cards with a local currency are nothing other than updated TCs and should be avoided due to their unfavorable rates of exchange and high fees charged per transaction.

Cash

For certain travelers needing euros to pay for apartments (and acknowledging associated risks of loss or theft) cash may be converted at reasonable rates at several locations in Paris. Exchanging dollars to euros will cost 2% to 3% which is about what big banks charge to use their credit cards:

http://www.bureaudechange.fr/

http://www.ccopera.com/

http://www.fcochange.com/

Electronic Funds Transfer (EFT)

For individuals who require euros to pay for apartments, schools, or other types of cash obligations, there are several entities which can easily make transfers for you at virtually no cost to the user. It requires your establishing an account (the process is similar to establishing a new bank account), linking this account to your local bank, and using a secure on-line interface. These operate in a very similar fashion to Paypal except that they can make a payment in virtually any currency. Payments may be made with a wire transfer (with modest cost), EFT (at no cost), or drafts may be sent using the mail system (at no cost):

http://www.hifx.com/

http://www.xe.com/

http://www.currencyonline.com/

There are a few additional steps involved such as establishing the payees address or bank information but for many types of transactions this option is fast and very inexpensive.

Conclusion

Make no assumptions about what your bank is charging you for access to your money. Ask about fees and how they are assessed. Many banks, most of them large, national banks, are more concerned about offering meaningless promotions than they are in providing quality, low cost service to their clients. Do not overlook small regional banks or credit unions. These institutions can save you a bundle and offer more personalized service in the process.

Spending in Euros

Sarastro — Thu, 07 May 2009 04:44:22 +0000

Though certainly no expert, I have followed the topic of money exchange carefully for some time now and have drawn several conclusions. Here is a summary of money exchange options and how you may benefit from the advantages of each one:

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Credit Cards

1. While your bank may not charge a currency conversion fee, Visa and Master Card does on all transactions made outside of the US whether the charge is in dollars, euros, pound sterling, or any other currency.

2. Most banks, particularly the large well known variety, add a 2%-4% service fee to all international charges or fixed fees per transaction or both. You will pay this in addition to the 1% Visa/Master Card currency conversion fee.

3. Many smaller banks or credit unions pass along the 1% MC/Visa currency conversion fee but few add any additional fees of their own

4. If you return an item or are issued a credit on your card, you will incur new and additional fees on the credit transaction.

5. Capital One is one of the few credit card issuers that not only adds no fees of their own to international transactions but absorbs the Visa/MC currency conversion fees. Using this or a similiar card is the least costly means of doing business (making purchases) outside of the US. What Capital One may charge for those carrying monthly credit card balances is another matter.

6. Discovery cards are not accepted in France (or Europe in general). American Express is accepted by hotel chains and more exclusive restaurants. AE is not widely accepted outside of well trodden tourist paths.

7. The only way to really know what you are paying for the privilege of using your credit card while traveling is to ask a knowledgeable representative at your bank. This website may help one understand the costs of international transactions:

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ATM Cards

1. Few if any French banks charge for withdrawing money from their ATMs. This means transactions are at or near mid market rates with no fees.

2. Cirrus and Pulse charge a 1% currency conversion fee on all ATM withdrawals make using their networks.

3. Few US banks will miss the opportunity to add fees and charges to international ATM transactions. The Bank of America/BNP alliance offers no cost currency exchange in obtaining euros at market rates. Again, many smaller banks and credit unions do not charge for international ATM withdrawals.

4. Those using ATM cards with 6 digit PINs may want to confer with a knowledgeable representative at their bank as 4 digit PIN access appears to be a European norm. A 6 digit PIN card carrier may find that his card work fine by entering only the first 4 digits with withdrawing cash at a European ATM.

5. If your ATM card is tied to more than one account, a French ATM will not give you the option to choose from which of your accounts the withdrawal will be made. Knowing which of your accounts tied to ATM withdrawals in the default account may be useful information for those travelling.

6. When in need, remember that virtually all French post offices have ATM machines available.

7. Daily limits may make using ATM machines as a primary means to obtain funds for prepayment of apartments difficult. These limits are generally set by terms established by your bank, not necessarily a French bank.

8. The only way to really know what withdrawals will cost is to ask a knowledgeable representative at your ATM issuing bank.

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Travelers Checks

1. In my opinnion, ATM machines have made Travelers Checks obsolete.

2. Travelers Checks are expensive to buy, difficult to spend, and are generally exchanged for euros at rates less favorable than cash rates (direct dollar for euros).

3. Overall, I find no compelling reason to use them.

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Cash

1. There may be many valid reasons which require one’s obtaining large cash amounts in euros; rental or apartment deposits/advance payments being one of the most common.

2. Generally, the most cost effective way of obtaining large euro amounts is to trade dollars in Paris (acknowledging the obvious risks). I have found the following offer the lowest overall cost to the traveler who needs such an exchange (usually at 2%-3% premium above the mid market rates):

CC Opéra

FCO Change

Bureau de Change

Updated 25 July 2009

Your mobile phone in France

Sarastro — Mon, 04 May 2009 20:28:01 +0000

There are many options for those wanting to remain in contact by phone: roaming with a North American provider, VoIP, Télécartes, or using a French mobile network just like the French do. Here is a rundown of providers offering pre paid cellphone plans:

Just a quick review of the requirements. Your GSM phone must be unlocked (allowing it to accept a different SIM than the one with which it came) and assuming you are using it in North America , it must be either a tri or quad band phone allowing you to receive GSM signals on the European bands (which differ from those in the US or Canada).

The prepaid minute, SIM market has a lot of choices and rates and features vary widely. Here is a rundown of the most popular French providers:

Orange retail outlets are widely available

http://www.orange.fr/

SFR retail outlets are widely available

http://www.sfr.fr/

Bouygue retail outlets are widely available

http://www.bouyguestelecom.fr/

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Virtural GSM operators piggy-back upon one of the above networks but sell their products at reduced pricing offering arguable the lowest per minute cost available:

E. Leclerc

http://www.leclercmobile.fr/

uses the SFR network

Carrefour

http://mobile.carrefour.fr/

uses Orange

Auchan

http://www.auchantelecom.fr/

uses SFR

Virgin

http://www.virginmobile.fr/

outlets widely available, uses the Orange network