How to avoid credit card overseas charges when spending abroad

For many Singaporeans, using a credit card overseas is convenient, whether you’re travelling or shopping online. However, hidden fees and unexpected costs make it important to use your card carefully, so you get the most from it.

This guide helps you get the most bang for your buck whilst spending in foreign currencies, by helping you understand the fees you could be charged, and how to minimise them. We'll also introduce the Wise card, a handy travel companion to make seamless card payments when you're overseas.

What are credit card overseas charges?

Whilst you may be familiar with the charges associated with your credit card whilst spending at home, it’s important to be aware that there are likely to be additional fees when travelling and spending abroad.

Overseas charges on your credit card are added because you are spending in a foreign currency - and may be imposed on top of any other charges you’d usually face.

These charges may come from:

• Your bank
• The card network
• The merchant
• Or a combination of the three

Most overseas fees are linked to converting your money from Singapore dollars (SGD) into the local currency. This conversion usually comes with additional costs, which we’ll explain below.

Banks charge these fees to cover the extra processing involved in currency conversion. International purchases require a network of banks to buy and sell currency.

Because these charges aren’t part of your everyday spending, they’re easy to miss, until your next credit card bill arrives. That’s why it’s important to understand when you’ll be charged, and how to reduce these costs.

Types of credit card overseas charges

There are many types of credit card overseas charges, which vary depending on your card. It’s important to understand how each one may affect you, and bear in mind that you might be charged more than one fee for any given card or transaction.

Foreign transaction fees

Foreign transaction fees apply when you spend in a currency other than your home currency - so SGD in this case. This is generally a percentage of the amount you spend, and covers currency conversion costs and processing fees.

Most banks charge between 1% and 3%. For example, HSBC charges 2.25% on all credit card transactions in foreign currencies1.

Foreign currency conversion markups

Many banks also add a foreign currency exchange rate markup.

This means that they give you a less favourable rate than the mid-market rate - what you’ll see if you look up the exchange rate on Google.

The marked-up rate is often advertised as a ‘retail rate’ and the markup is a type of hidden fee. How this works is that banks sell their currency for more than the price they buy it at, allowing them to keep the difference. It is easily missed, as, unlike upfront fees, a foreign currency conversion markup is simply a part of the exchange rate offered.

Dynamic currency conversion (DCC)

Dynamic currency conversion (DCC) lets you pay in your home currency instead of the local currency when you’re overseas².

It may seem convenient. You don’t need to calculate exchange rates, and you’ll see the charge in SGD. However, the exchange rate and fees are set by the merchant or DCC provider, not your bank³.

This is usually less favourable than your bank’s rate⁴, or the mid-market rate offered by Wise. As a result, your conversion - and the product or service you’re buying - will be more expensive than if you were to pay in the local currency.

How much do overseas credit card charges cost?

Overseas credit card charges typically range from 1% to 3%, depending on your card.

Before travelling, check the fees that apply to your specific card. Consider how those fees might add up based on how you plan to use it.

For example, if you plan on taking cash out of an ATM using your credit card, be aware that this is likely to be treated as a cash advance.

This is different from normal card spending:

• You’ll be charged interest on your purchase from the moment you take your cash out
• There’s no interest-free period
• Extra cash advance fees may apply

Using HSBC as an example, the fee may be the higher of approximately 6% of the amount withdrawn or 15 SGD, plus annual interest of around 26%⁵.

You also won’t earn rewards or rebates on cash advances. On top of that, both your bank and the ATM operator may charge additional fees. These costs can add up quickly over a trip.

Before you travel, compare your options. It may even be worth opening an account designed specifically for international spending, especially if you travel often.

Example: The cost of spending 1,000 EUR in SGD

For many Singaporeans, a trip to Europe can be an exciting adventure - but making sure you’ll get the most from your trip might come down to having the right card, with minimal fees.

Below is an example comparing 1,000 EUR spending on a Visa credit card versus a Wise card. This assumes a typical 3% bank fee.

*Assuming a 3% bank fee - this varies by card and is for illustrative purposes only. Details correct at the time of research - 24th February 2026.

How to avoid or minimise credit card overseas charges

Whilst it might seem like credit card fees are hidden around every corner when spending overseas, there are also ways to minimise them.

Always choose the local currency when paying abroad

When paying abroad, select the local currency instead of SGD. This helps you avoid DCC, which often comes with higher and less transparent conversion fees.

Check your card’s foreign transaction fee

If you’re using your card to earn rewards, check its overseas fee first.

Extra FX costs may outweigh any miles or cashback you earn. Sometimes, using a cheaper card makes more sense, even if you miss out on rewards.

Consider a specialist international account

You may want to open an account with a provider like Wise, which is designed for international spending. By using a specialist provider, you’ll likely receive a better exchange rate and lower fees overall, which may mean you spend less in the end when you travel abroad. More on that, next.

Get the Wise card for international spending and cash withdrawals

The Wise card lets you spend in 40+ currencies at the mid-market rate including MYR, JPY, CNY, and USD so you know you'll be getting a great deal in over 150+ countries. Simply create a free Wise account, order a card and top-up SGD to get started.

Virtual cards are free and can be added to your Google or Apple Pay wallet, while a physical Wise card can be ordered for a low fee of 8.50 SGD. Having a physical Wise card allows you to make chip and pin payments, as well as 2 free ATM withdrawals to the value of 350 SGD each month, before low fees start.

While abroad, you can choose to spend with directly in SGD and let auto-conversion do the trick, or convert to your desired currency with your Wise account. Either way, you’ll get the exchange rate you see on Google, with low, transparent fees from 0.26%.

Plus, you can activate Wise Interest to earn returns* on your SGD and other currencies, meaning your travel money could be growing right up until you spend it.

*Growth is not guaranteed. Capital at risk.

💳 Get your Wise card

1. HSBC - Retail banking: Wealth management banking tariffs
2. Visa - Travel with Visa: dynamic currency conversion
3. Wise - Choose local currency at foreign ATM
4. DBS - Card charges and fees: Overseas transaction fees
5. HSBC - International foreign transaction fees: using your card abroad
6. Visa - Consumer travel support: exchange rate calculator