Best No Foreign Transaction Fee Credit Cards In Canada for April 2024
What You Should Know
- No foreign transaction fee credit cards allow you to save on the fees charged when you make purchases in foreign currency.
- Most credit cards charge foreign transaction fees of up to 2.5%. No foreign transaction fee credit cards allow you to save up to 2.5% on every foreign transaction.
- No foreign transaction fee credit cards can benefit frequent travelers and those purchasing in foreign currencies regularly.
- Even though no foreign transaction fee credit cards may not charge the fee, they may charge a higher exchange rate than other credit cards.
About No Foreign Transaction Fee Credit Cards
Most credit cards in Canada have foreign transaction fees, also known as a forex fee or FX fee, that are added on top of every purchase made in foreign currency. This fee is usually 2.5%, which is charged on top of the foreign currency conversion rate.
No foreign transaction fee credit cards can be useful for frequent travelers or people who make purchases in foreign currency. These cards can help them save money by eliminating the foreign transaction fee, but the users should also be aware of the conversion rate their credit card offers. The best credit cards in Canada usually have a foreign transaction fee, but many of them have a reasonable conversion rate that keeps them competitive among the no foreign transaction fee credit cards.
Many credit cards with no foreign transaction fees offer travel rewards and cash back, and additional perks including travel insurance coverage. We have listed the best no FX fee credit cards in Canada along with their benefits so that you can pick the one best for you.
What is a Foreign Transaction Fee?
Most credit cards charge you the foreign transaction fee for converting your transactions in foreign currencies to Canadian Dollars before posting the charge to your credit card statement. The FX fee applies to any refunds that you receive as well. Cards with no FX fee don’t charge this fee. However, they may be charging an exchange rate higher than the exchange rate of the credit card network.
Best No Foreign Transaction Fee Credit Cards
How we Sort Credit Cards: We sort credit cards based onand the card's annual fee. We estimate the dollar value of the rewards you would get based on your spending categories, and we subtract the annual fee the card charges to get the best credit cards for your spending habits. We also use the salary to filter out cards based on the minimum income requirement.
$0.00
Purchase: 21.99%
Cash: 21.99%
Individual: $15,000
580
or More
Cash Back
- 1% Cashback for each $1 spent on: all eligible purchases.
Other Perks
- No FX Fees
$0.00
Purchase: 0.00%
No Income Required
No Minimum
Credit Score
Cash Back
- 0.5% Cashback for each $1 spent on: all eligible purchases.
Other Perks
- No FX Fees
- No monthly fees, or other hidden fees.
- Earn the same high interest of your Savings Plus Account on your card balance.
$99.00
Purchase: 19.50%
Cash: 21.99%
Household: $100,000
Individual: $60,000
580
or More
Cash Back
- 6% Cashback for each $2 spent on: FX Transactions.
- 3% Cashback for each $2 spent on: everything else.
Other Perks
- No FX Fees
Insurance Included
- Baggage Loss/Delay
- Car Rental
- Common Carrier
- Travel Emergency Medical
- Trip Delay/Cancellation
- Trip Interruption
- Extended Warranty
- Mobile Device
- Price Protection
- Purchase Assurance
$108.00
Purchase: 0.00%
No Income Required
No Minimum
Credit Score
Cash Back
- 6% Cashback for each $1 spent on: select merchants.
- 2% Cashback for each $1 spent on: grocery, transit, restaurants and food delivery.
- 0.5% Cashback for each $1 spent on: everything else.
Other Perks
- 4.5% interest on your first $1000 and 3% on anything after that.
- No FX Fees
- Credit Building for $7/month instead of $10.
- Up to $100K of your balance is protected by CDIC.
- Unlimited e-Transfers.
How to Choose a No Foreign Transaction Fee Credit Card
Exchange Rates
Exchange rates for transactions in foreign currency is determined by the credit card provider. Many popular credit cards use an exchange rate set by the credit card network such as VISA, Mastercard or Amex, and they charge a 2.5% foreign transaction fee on top of it. No foreign transaction fee credit cards do not charge the 2.5% fee, but they may use different exchange rates. It is important to research the exchange rates your credit card uses to avoid being charged a high amount due to a bad exchange rate.
Annual Fee
Most credit cards with no foreign transaction fee have an annual fee that can reach hundreds of dollars. These credit cards usually have reasonable exchange rates, good rewards and insurance packages that may benefit frequent travelers. There are also no-fee credit cards with no foreign transaction fee, but they usually have little to no benefits and unfavourable exchange rates.
Rewards
Many no foreign transaction fee credit cards offer rewards or cash back that can offer a return of as much as 5 cents on every dollar spent. Rewards are also different for different spending categories, so it is important to pick a card that would maximize your rewards based on your spending patterns. For example, if you spend a lot on gas and groceries, you should look for a credit card that would prioritize the rewards on these spending categories.
Welcome Bonus
A lot of credit cards offer a welcome bonus, which is tied to the rewards the card provides. Some cards can offer thousands of reward points or hundreds of dollars in statement credit as a welcome bonus. Some people even use a credit card churning strategy to get advantage of generous welcome bonuses. Welcome bonuses should be considered because they may provide rewards that may take years to accumulate.
Alternatives to No Foreign Transaction Fee Credit Cards
US Dollar Credit Cards
A lot of Canadians travel to the United States frequently or make online purchases with US retailers. Some Canadians also have an income in US Dollars but pay their bills in Canadian Dollars. US Dollar Credit Cards are best suited for such people as these types of cards do not charge a foreign transaction fee on US dollar purchases. The transactions are done entirely in US Dollars with the payment made in US Dollars as well, saving the currency conversion fees. US dollar credit cards charge a foreign transaction fee for purchases made in currencies other than USD.
Prepaid Cards
There are prepaid cards available in Canada that offer benefits on transactions in Foreign Currencies. Some of them are listed below along with their features.
- CIBC AC Conversion Visa Prepaid Card - This reloadable card allows you to load up to 10 currencies and spend directly in the foreign currencies. There is no extra conversion fee and the loaded currencies are not affected by fluctuations in exchange rates. It should be noted that the exchange rate here is the one set by CIBC and is usually higher than the rate set by the card network rate.
- KOHO Premium Prepaid Card - A reloadable prepaid card with 0% foreign transaction fee and one free international ATM withdrawal per month.
Credit Cards with Cashback on FX Transactions
Some credit cards may offer cashback on transactions in foreign currencies that could balance out the foreign conversion fee charged. Some examples of such cards are:
- The Rogers World Elite Mastercard and the Rogers Mastercard both can offer 3% cashback on US Dollar transactions, which offsets the 2.5% FX fee.
- The Amazon.ca Rewards Mastercard offers eligible Prime members 2.5% back on foreign currency transactions to help cover FX fees.