Currency Exchange Markup: Cash vs. Credit
Jan 4th, 2008 by Nick
Friday’s exchange rate was 1 Australian Dollar=US$0.8816. The effective rate, however is a bit worse due to various foreign exchange charges. But the rate from my ATM card is significantly better than the one from one of my credit cards: 0.8816 vs. 0.9093. Even adjusting for the fact that I get miles on the credit card, it’s not better.
It does not seem like much, but I’ll probably run through about US$2000 in non-hotel charges on this trip. For that amount, the difference is US$55.
Of course part of the reason that I get a good ATM rate is that Bank of America has a deal with the Australian bank Westpac to waive the US$5 ATM fee. Otherwise, for US$150, the rate would be over 0.92. Citibank has local branches as well.
Maybe there’s a reason I stay home all the time.