Thursday, October 10, 2013

Bank Of America And The Global ATM Alliance

I use credit cards with no foreign exchange fees as much as I can when traveling abroad. It saves me from carrying a wad of cash in an unfamiliar environment, and I can rest assured knowing that I am being charged a reasonable rate. However, there are always times when the local currency is needed, whether it's at a restaurant that only accepts cash, or just for simple things like tipping.

It can be a hassle trying to find ways to obtain cash, especially when you're in the midst of a hectic travel schedule. You can always bring a stack of U.S. dollars (or whatever your base currency is) and do the conversion upon arrival, either at the airport or when you get into town. But doing so typically incurs high fees and a lousy exchange rate. The most straightforward method, in my opinion, is to stick with withdrawing cash directly from a bank ATM.

Bank of America charges customers a $5.00 international ATM fee, in addition to the fee that the local ATM will tack on to any withdrawal. This is where the Global ATM Alliance can save you quite a bit of money. A joint venture between several major international banks, the Global ATM Alliance allows customers to use their ATM or debit cards at any bank within the alliance without incurring any local or international ATM fees. Here are the participating banks, in addition to Bank of America in the United States:

Although not listed above, you can use China Construction Bank in mainland China (excluding Hong Kong) and Banco Santander in Mexico without any local or international ATM fees as well. Be aware that fee-free usage of any of the Global ATM Alliance banks only applies in the specific coverage area. For example, if you decide to use a Deutsche Bank ATM located outside of Germany, all applicable fees will still be charged.

Bank of America also warns customers that an international transaction fee of 1% may still apply when converting your currency. This fee jumps to 3% effective November 8, 2013. However, in my experiences using the Global ATM Alliance, I have never been charged this additional transaction fee. I have used Deutsche Bank in Germany, Barclays in the U.K., and Westpac Bank in Australia in just the past three months. For customers of other banks within the alliance, this Wikipedia entry has a lot more details regarding additional rules for each bank.

The Global ATM Alliance makes withdrawing money internationally a much less expensive proposition, and beats converting currency at the airport or at an exchange shop hands down. Nowadays, when traveling to any of the countries listed in the coverage area, I bring at most a $100 bill purely for emergencies, and withdraw any amount I need directly from the alliance banks.

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