Foreign transaction fees to look out for when using your debit card abroad

How much are you paying for foreign transaction fees and ATM withdrawals when using your card abroad? Read this article to learn more.
6 min read
Going on holiday should be a stress-free experience—but when it comes to using your debit card abroad and withdrawing money from an ATM, foreign transaction fees can mean you end up paying more than you bargained for. Thankfully, this guide is here to help you familiarize yourself with the ins and outs of pulling out the plastic when you’re overseas.

The bank you'll love

✓ 100% mobile ✓ No hidden fees ✓ No paperwork ✓ Free virtual Mastercard ✓ Free ATM withdrawals

Get started
An elevated hand holding a transparent N26 Standard card.

What are foreign transaction fees?

When using your card abroad, your bank can levy fees. While there’s often a payment fee charge on the basis of the overseas payment itself, you could also face a foreign transaction fee. This applies to payments made in a currency different from your bank’s ‘home’ currency. Additionally, banks can also charge a currency conversion fee of an average of 1.5%, applied to transactions carried out on weekends to safeguard against changes in the exchange rate.

How foreign transaction fees work

To understand best how foreign transaction fees work, let’s look at an example. Imagine you’re traveling in England and buy a T-shirt for 30 Sterling pounds. Let’s say you’re converting from euros at an exchange rate of 1.17, meaning the T-shirt will actually cost around 35 euros. If you add on an additional 3%, you’re actually paying 36.05 for the T-shirt. While it doesn’t seem like a lot, these fees can really add up over time.

Banking basics

Banking jargon can be confusing—but it doesn't have to be. Find simple explanations to popular banking terms.

Learn the basics
Banking basics.
Even if your bank doesn’t levy any additional fees, overseas payments can still cost you. Here's why:
  • Using your debit card abroad, the local currency will be converted to your home currency at the rate set by Mastercard or Visa. Most debit cards do this.
  • Mastercard and Visa don’t always offer the same rates.
  • Mastercard’s rates tend to be preferable to Visa’s rates, by an average of 0.27%.
  • This difference can also be more, almost three cents on the euro—that’s €3 if you’re making a payment of €100.
Then, there’s also the FX spread. This is the difference between the rate that a bank buys foreign currency at, and the rate that it sells it. And guess what? It’s not always in your favor. While Bank A could have a FX spread that’s 0.21% cheaper than the underlying Mastercard rate, major Bank B could have a FX spread that’s 0.27% more expensive than this underlying figure. Additionally, FX mark-ups are charged by banks on top of the FX spread fee. Bank A could charge a variable rate depending on whether it’s a weekday or a weekend, ranging from 0.1% to 1.5%, whereas Bank B might always charge a rate of 1.75%.On top of these variable fees, card providers can hit you with a fixed fee. Bear in mind that this only applies for cash withdrawals, not card payments.

What foreign transaction fees could I be charged for withdrawing cash abroad?

If you run out of cash while you’re abroad, you might withdraw money from an ATM—and this is different from just using your debit card to make a payment in a shop. The same kind of bank fees apply as mentioned above (namely, the FX spread and FX mark-up), but there’s usually also a fixed fee. For example, major Bank A may hit you with a fee of €2 per withdrawal in excess of €400/month, depending on the country you’re visiting. On top of this, the ATM provider can also charge a fee of around €2 to €3 for each overseas withdrawal. It all adds up!

How much will it cost me to withdraw money abroad?

Say you withdraw €100 from an ATM while overseas—here's what you might pay if you have an account with Bank B:
  • An ATM provider’s fee of €3.
  • An FX mark-up of 1.75%.
  • A cash withdrawal fee of €5.
That comes to almost €10 in fees, and that’s before you even start to take into account less-than-favourable exchange rates.The situation is a bit different if you want to send money to another bank overseas, rather than simply withdrawing it. In this case, you’ll pay a wire transfer fee. Major global Bank C has a fee of €15 for incoming wire transfers and €35 for outgoing ones, while major global Bank D charges €15 for incoming payments, and €45 for outgoing wire transfers.

What sort of foreign transaction fees do major European banks actually charge?

It’s worth noting that the payment provider in question, i.e. Mastercard or Visa, isn’t the only thing that affects the amount you ultimately pay. There are also enormous differences between the foreign transaction fees levied by banks across the EU. Here’s an outline:
  • UK debit cards from new ‘challenger banks’ don’t charge anything for making payments abroad. Others (including major high street banks) can take up to 3% for every transaction.
  • German debit cards (known as EC cards) work similarly. For example, app-based German Bank A lets you make payments and take cash out abroad without charge, while German Bank B only lets you withdraw €200 overseas before incurring a fee of €2 - €3 per withdrawal. Almost all the major German banks charge a fee of an average of 1.5% to 2% on top of this, however.
  • Italian Bank A charges a fee of €2 every time you use an ATM to withdraw cash outside their network (including overseas).
  • French banks don’t charge any fees for making payments anywhere within the Eurozone. They charge only a small fee (usually around 1%) once you've made more than three or four overseas cash withdrawals in a month.
  • In Spain, the situation is less appealing. Major Spanish Bank A charges a fee of 4.5% on the amount withdrawn overseas, with a minimum fee per withdrawal of €3.50.

Why do banks make money on foreign currency exchange rates?

There’s no such thing as a free lunch, after all. Banks incur costs of their own when sending your money overseas, such as the fees levied by the likes of Visa and Mastercard for processing payments. And, of course, they are offering you a service by enabling you to access your money overseas—some banks believe it is right for you to be charged for this.

Your money at N26

Here at N26, we want to be as transparent as possible and our mission is to cut back on fees wherever we can. This is why most of the above costs don’t apply—with our free bank account, we offer up to 5 free ATM withdrawals in euros and don't charge foreign transaction fees when you pay for something with your N26 Mastercard abroad. No hassle, no hidden costs.We want to simplify banking for everyone. We’re bringing you a series of articles that shine a light on the basics of money, finance and all things banking-related—take a look!


    The best way to pay abroad is with a credit or debit card and to pay in the local currency of the country you’re visiting.

    When paying with your card abroad, the Visa or Mastercard exchange rates will apply, as well as the “spread” and “markup” charges, which are set by your bank. At N26, we don’t charge any additional fees for transactions abroad.

    The Mastercard exchange rate varies depending on the currency that you make the transaction in. Typically, the Mastercard exchange rate is 0.27% better than Visa’s exchange rate.

    If you want to take money out abroad, in addition to fees like the spread or markup charges set by your bank, you’ll also have to pay a fixed fee that varies from bank to bank.

    You can withdraw money with your credit or debit card at any ATM abroad. All cards linked to N26 You and N26 Metal premium accounts allow you to withdraw money from any ATM in the world with no fees. With N26 Standard and N26 Smart accounts, you can withdraw money for free from ATMs in the eurozone.



BY N26Love your bank

Advertising message for promotional purposes. Please see the contractual documentation for more information in the Legal Documents Section.

Related Post

These might also interest you
How to master your shared savings goals.
Banking Basics

How to master your shared savings goals

From dream vacations to homeownership, here’s how to achieve It all with shared financial goals

5 min read
How inflation can deplete your hard-earned money, and ways to fight it.
Banking Basics

How inflation can deplete your hard-earned money, and ways to fight it

Inflation can take a toll on your money — if you let it. Here, we share strategies for fighting inflation, like investing and taking advantage of high-interest savings accounts.

10 min read
SEPA transfers made easy–everything you need to know.
Banking Basics

SEPA transfers made easy–everything you need to know

You’ve heard of SEPA payments, but what does it stand for, and how does it actually work? We unpack all you need to know about SEPA transfers here.

8 min read