What is a foreign transaction fee?

A foreign transaction fee is a fee charged by credit card companies on purchases made with a credit or debit card outside of the United States. This fee is typically charged as a percentage of the total purchase amount, typically 2-3%. This fee is charged to cover the cost of converting foreign currency into U.S. dollars, as well as any additional fees charged by the banks or credit card companies involved in the transaction. In Washington, according to the Credit Card Accountability Responsibility and Disclosure (CARD) Act of 2009, it is illegal for credit card companies to charge customers for foreign transaction fees greater than 3%. This law is designed to protect cardholders from excessive fees when making purchases in foreign countries. It is important to note that this law applies to all credit card companies operating in the United States, not just those based in the state of Washington.

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