Citibank offers a range of credit cards providing many rewards, cashbacks, and travel benefits. Most of these credit cards include perks like airport lounge access and travel insurance. Some of them charge a foreign currency markup fee of up to 3.5% on transactions made in a foreign currency. However, there are certain Citibank credit cards with zero foreign transaction fees. Let’s explore all the details related to Citibank Credit Card foreign transaction fees.
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What is a Foreign Transaction Fee?
A foreign transaction fee is a charge applied when you purchase an item in a foreign currency. This fee is levied by the issuer when you use your credit card for international transactions. These include shopping online from a foreign website or making purchases while travelling abroad.
Banks and credit card companies charge these fees to cover the cost of currency conversion and to offset the risk of fluctuations in exchange rates. While 3.5% is a relative standard, it’s always a good idea to be aware of the charges before making any foreign purchases.
Also Read: This blog is a comprehensive guide on the benefits of opening an account in Citi Bank, USA as an international student. Read to know them all!
CitiBank Credit Card Foreign Transaction Fee
All Citi credit cards, except the Citi Rewards Domestic Credit Card, will incur a 3.5% markup fee on the INR equivalent of the US Dollar for international transactions in USD, based on the Citibank currency exchange rates and conversion rates set by the card networks.
For transactions in currencies other than US Dollars, the amount will first be converted into US Dollars using the conversion rates published by the card networks, before being converted into INR. Citi will charge a percentage of the total value in Indian Rupees (INR) as a fee.
Besides, Citibank Credit Card foreign transaction fee also includes a Dynamic Currency Conversion (DCC) charge on certain credit cards for international transactions performed in Indian Rupees (INR).
Dynamic Currency Conversion (DCC) is a service offered by merchants or ATMs that allows international cardholders to make transactions in their home currency, instead of the local currency of the country where the purchase is being made. Here’s the list of cards along with the DCC charges on them-
| Citibank Credit Cards | Dynamic Currency Conversion Charges |
| Citi Prestige Credit Card, Citi Corporate Card | No markup charges |
| Citi PremierMiles Credit Card, Citi Cash Back Credit Card, Citi Rewards Domestic Credit Card, Citi Rewards International Credit Card, First Citizen Citi Credit Card, IndianOil Citi Credit Card, CitiBusiness IOC Credit Card, CitiBusiness Credit Card, IKEA Family Credit Card by Citi | 1% (+GST) on each international transaction made in Indian currency |
| Please note that these charges are available on the mentioned Citibank credit cards, effective from 15th January 2024. | |
Citibank Credit Cards with No Foreign Transaction Fee
There are several Citibank credit cards with no foreign transaction fees, making them ideal choices for those who frequently travel internationally or shop from foreign retailers. These cards help you save a considerable amount on every purchase made abroad.
Let’s take a closer look at some of these Citi cards that come with the added benefit of no foreign transaction fees.
Citi/ AAdvantage Platinum Select World Elite Mastercard
The Citi/ AAdvantage Platinum Select World Elite Mastercard is a great option for travellers who are loyal to American Airlines. This card not only provides a wide range of travel benefits, such as earning AAdvantage miles on every purchase, but it also offers no foreign transaction fees.
Whether you’re booking flights, dining abroad, or making purchases at international retailers, you won’t incur additional costs for using your card outside the United States.
Costco Anywhere Visa Card by Citi
For Costco members who frequently travel or shop internationally, the Costco Anywhere Visa Card by Citi is a solid choice. This card offers no foreign transaction fees and provides rewards on purchases made worldwide.
It offers cashback on eligible purchases like gas, dining, and travel, all without the added burden of foreign transaction fees when making purchases outside of the United States.
Citi/ AAdvantage Executive World Elite Mastercard
The Citi/ AAdvantage Executive World Elite Mastercard is a premium travel card specifically designed for frequent American Airlines travellers. It comes with the added benefit of no foreign transaction fees, so you can enjoy international travel and purchases without worrying about extra charges.
This card also offers high earn rates on American Airlines purchases and access to valuable travel benefits like Admirals Club membership, making it an excellent choice for those who travel often.
Citi/ AAdvantage Business World Elite Mastercard
For business owners who travel internationally, the Citi/ AAdvantage Business World Elite Mastercard is a top-tier card that offers no foreign transaction fees. With this card, you can earn AAdvantage miles on business purchases, including travel, office supplies, and more.
Plus, there are no additional fees for international business transactions, making it an ideal option for frequent business travellers looking to maximize rewards without the added cost of foreign transaction fees.
Costco Anywhere Visa Business Card by Citi
Similar to the personal Costco card, the Costco Anywhere Visa Business Card by Citi offers no foreign transaction fees. It’s perfect for business owners who shop internationally or travel abroad for work.
This card also provides rewards on eligible purchases such as gas, travel, and dining, and it eliminates the foreign transaction fees, helping to save money on international purchases for your business.
Also Read: Know everything about Citibank international wire transfer – what are the transfer limits, citibank global transfers, and more.
How Does Citibank Credit Card Foreign Transaction Fee Work?
When you make a transaction in a foreign currency, the first step is converting that foreign currency into US Dollars (USD). After that, the USD equivalent is converted into Indian Rupees (INR) using the exchange rate provided by card associations like MasterCard or Visa.
- On top of the exchange rate, Citi charges a foreign currency markup fee of up to 3.5% of the transaction amount. This fee is calculated on the INR equivalent of the transaction value after the foreign currency has been converted to USD and then to INR.
- For example, if you purchase Euros or British Pounds, Citi first converts the amount into USD and then converts it into INR. The fee is added to this final amount.
Tips to Avoid or Minimize Citibank Credit Card Foreign Transaction Fees
Foreign transaction fees can add up quickly when making purchases abroad or shopping on international websites. Citi charges a fee of up to 3.5% for foreign transactions, so it’s essential to be mindful of ways to minimize these costs.
By following these tips, you can minimize the impact of foreign transaction fees and avoid paying unnecessary charges when shopping or travelling abroad.
- Use a Credit Card Without Foreign Transaction Fees
Some credit cards are specifically designed for international travellers and don’t charge foreign transaction fees. These are called zero Forex markup credit cards. If you travel frequently or make international purchases, consider applying for a Citi credit card or another card that offers no foreign transaction fees. This will help you avoid paying extra charges on each foreign purchase.
- Pay in the Local Currency
When travelling abroad, always opt to pay in the local currency rather than allowing the merchant to charge you in your home currency (Indian Rupees). By choosing to pay in the local currency, you ensure that the transaction is converted using the exchange rates set by the card network (MasterCard/Visa), and you avoid the DCC markup.
- Shop Online Using INR
When making online purchases from international websites, check if they offer prices in Indian Rupees (INR). If you’re able to shop in INR, it will save you from the hassle and cost of currency conversion altogether. This also eliminates the need for Citi to apply the foreign transaction fee. Alternatively, you can use the best forex cards for Indian travellers to save on additional costs.
- Be Aware of DCC
If you’re using your Citi credit card internationally and the merchant offers Dynamic Currency Conversion (DCC), be aware of the potential added costs. The merchant or DCC service provider will convert the transaction into INR, but the exchange rates they use could be unfavourable, leading to higher charges. Always check the final amount before confirming payment. If the merchant offers DCC, declining the option and opting to pay in the local currency will help avoid the additional charges.
- Keep Track of Your Transactions
To stay on top of your spending and spot any unexpected fees, hold on to your transaction slips. This makes it easier to cross-check your expenses with your credit card statement. You can also use your smartphone to quickly check your account balance or track spending via your banking app, ensuring that you catch any discrepancies early.
This was all about Citibank’s foreign transaction fee. To learn more about education loans, the best bank accounts for students, forex, banking experience for global students, or international money transfers, reach out to our experts at 1800572126 to help ease your experience with studying abroad.
FAQs
A foreign transaction fee is a charge applied for purchases made in a foreign currency, typically up to 3.5% of the total transaction amount in INR.
All Citibank credit cards, except for the Citi Rewards Domestic Credit Card, incur a 3.5% foreign transaction fee on purchases made in foreign currencies.
The fee is calculated based on the INR equivalent of the foreign transaction amount after it is converted first into US Dollars (USD) and then into INR.
Yes, Citibank offers cards like the Citi AAdvantage Platinum Select World Elite Mastercard and Costco Anywhere Visa Card with no foreign transaction fees.
DCC is a service where merchants convert your transaction into your home currency (INR), potentially charging extra fees. Opting for local currency is usually better to avoid high charges.
If you choose DCC, the merchant converts the transaction into INR, often at unfavourable exchange rates. Citi may charge a 1% (+GST) fee on transactions made in INR.
You can avoid fees by using Citi credit cards with no foreign transaction fees or paying in the local currency instead of opting for DCC.
Citibank charges a foreign currency markup fee of up to 3.5% on the INR equivalent of transactions made in foreign currencies, including USD.
Foreign transactions are first converted into US Dollars, then converted into INR using exchange rates set by Mastercard/Visa. The foreign transaction fee is then applied.
To minimize fees, use a card without foreign transaction charges, pay in local currency, and avoid Dynamic Currency Conversion when abroad.
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