Lois Larson
Airport ATMs are convenient for travellers who need local currency immediately upon arrival in a foreign country. However, it's important to note that most airport ATMs are not affiliated with banks and often charge high transaction and conversion fees. Travellers are usually better off using currency exchange services or bank ATMs, which typically offer more favourable exchange rates. Additionally, some banks may charge a fee for out-of-network ATM usage, so it's essential to understand your bank's policies and fees before relying on airport ATMs for cash withdrawals while travelling.
| Characteristics | Values |
|---|---|
| Availability of bank ATMs at airports | Yes, but they may be hard to find. |
| Independent ATMs at airports | Yes, but they may charge high fees. |
| Currency exchange booths at airports | Yes, but they may offer poor exchange rates. |
| Fees for using airport ATMs | Vary depending on the ATM, card, and bank. Some charge transaction fees, conversion fees, and foreign transaction fees. |
| Recommendations | Use a debit card with no fees, use a card that refunds ATM fees, or withdraw cash before your trip. |
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What You'll Learn
Airport ATMs often charge high fees
It is advisable to use a debit or credit card that refunds ATM fees or has no fees, to avoid these charges. Some banks, such as Charles Schwab and Fidelity, offer accounts with no foreign ATM fees and rebate charges. Alternatively, ordering currency through a bank or AAA membership can help to avoid fees, although the rates may vary. Using a fee-free credit card can also be beneficial, as some card institutions do not add a supplement to the wholesale exchange rate.
Bank ATMs usually offer the best exchange rates, so it is recommended to use these instead of airport ATMs. If possible, using an ATM from a local bank at the airport is preferable to a freestanding ATM. However, it is important to note that some countries, such as Italy, Turkey, and Dubai, may have limited access to bank ATMs, and airport exchange rates are generally unfavourable. Therefore, it is suggested to change only a small amount of money at the airport to cover immediate expenses and find a better exchange rate elsewhere.
Additionally, it is crucial to decline the offer to convert currency to your home currency at the ATM, as the conversion rate will likely be very unfavourable. Instead, allowing the charge in local currency and letting your home bank convert it is recommended. Checking the terms and conditions of your bank before travelling can help you understand any potential fees and make more informed decisions when using airport ATMs.
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Using a debit card with no fees is advisable
When travelling, it is advisable to use a debit card with no fees. This is because airport ATMs are often not true bank ATMs, and can charge high fees for transactions and currency conversion. Some sources suggest that airport exchange rates are unfavourable, and that it is better to use an ATM from a local bank, or to order currency through your bank before your trip.
However, it can be useful to have local currency immediately upon arrival, and some airports and train stations do not have foreign exchange offices, or may have limited opening hours. In this case, using a debit card with no fees is a good option, as it allows you to withdraw money without incurring additional charges.
Some banks, such as Bank of America, do not charge their customers fees for using their ATMs to make withdrawals, transfers or deposits. However, if you are using a non-bank ATM, you may be charged a fee. This is where a no-fee debit card can be useful, as it allows you to avoid these charges. Cards from Charles Schwab and Fidelity, for example, rebate all ATM fees.
It is also worth noting that some banks may charge a percentage supplement on top of the wholesale exchange rate, and some may also add a flat fee for foreign currency transactions. Therefore, it is important to check the terms of your bank or card provider before travelling, to understand any potential charges you may incur.
Additionally, it is recommended to advise your bank if you plan to use your debit card abroad, as many banks now block foreign transactions as suspicious activity.
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Bank ATMs usually offer the best exchange rates
When it comes to exchanging currency, bank ATMs typically offer the most favourable exchange rates. Airports usually have ATMs from both independent ATM providers and local banks from the country you are visiting. However, most airport ATMs are not affiliated with banks, and as a result, they may charge excessive transaction and conversion fees.
It is recommended that you use an ATM from any bank, as this is a better option than using an airport or city centre freestanding ATM. Bank ATMs are likely to provide competitive exchange rates and lower fees, typically ranging from 1% to 3%. Using your financial institution's mobile app, you can locate an ATM near you. If your bank does not have branches or in-network ATMs in the country you are visiting, you may still be able to use your debit card at a local ATM, but be aware that foreign ATM fees may apply.
It is advisable to exchange currency at your bank or credit union before travelling to another country, as they often provide better rates and lower fees. Your bank may also buy back any leftover foreign currency and exchange it for dollars upon your return. Additionally, some banks allow customers to order foreign currency online or through their mobile banking app.
To avoid unnecessary fees, it is important to understand the various options presented by ATMs during transactions. When given the choice to pay in your home currency, it may seem convenient, but this option, known as dynamic currency conversion (DCC), often includes significant hidden fees. Instead, always choose to pay in the local currency to avoid unexpected charges.
In summary, bank ATMs generally offer the best exchange rates, especially when compared to freestanding ATMs commonly found at airports and city centres. To minimise fees, it is recommended to use your financial institution's ATMs and choose to pay in the local currency during transactions. Additionally, consider exchanging currency at your bank before travelling and utilising their online or mobile app services for foreign currency needs.
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Avoid currency exchange booths at airports
While currency exchange booths at airports offer a convenient way to exchange money, there are several reasons why you may want to avoid them.
Firstly, airport exchange booths often offer unfavourable exchange rates. They may advertise 0% commission or no fees, but they typically make their money by marking up the exchange rate. This means you may end up paying a lot more than necessary for your transaction.
Secondly, airport exchange booths tend to charge high fees for their services. These fees can include transaction fees, conversion fees, and surcharges, which can quickly add up and eat into your funds.
Thirdly, you may have limited options at the airport, especially if you're in a rush to catch a flight. This lack of competition means that airport exchange booths can get away with offering inferior rates and higher fees.
Instead of using an airport exchange booth, consider ordering currency through your bank before your trip. Many banks allow you to order foreign currency online or through a mobile app, and they may offer better exchange rates and lower fees. If you need to exchange money while abroad, look for ATMs from local banks, which often provide competitive exchange rates and lower fees. Additionally, consider using a credit or debit card with no foreign transaction fees, as this can help you avoid many of the extra charges associated with exchanging currency.
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Inform your bank in advance of your travels
When travelling, it is always a good idea to inform your bank in advance. This is because currency exchange policies or cash withdrawal policies in foreign countries can be drastically different from what you are used to. By informing your bank, you can ensure that you have a smooth transaction process every time.
Firstly, you can ask your bank about the services provided by overseas or foreign banks that are in partnership with your local bank. You can also ask your bank some questions in advance regarding your travel so that you are not confused about the various matters related to your finances when you land at the airport. For example, you can ask if your bank has an ATM cash machine in the foreign country you will be travelling to.
Secondly, you can ask your bank to raise your withdrawal limit if needed. This is because, in a foreign country, you may need to withdraw more cash than you usually would, owing to the various fees and charges that may be levied.
Thirdly, you can verify your PIN before you travel. Some ATMs outside the United States don't have letters on the keypad, so it is important to know your PIN by numbers. In case your PIN starts with a zero or has more than four digits, you can change your PIN before travelling to a foreign country.
Lastly, you can ask your bank about the various fees and charges that may be levied on you when using your debit or ATM card in a foreign country. For instance, some banks may charge a fee for using a non-bank ATM in a foreign country. Knowing about these charges in advance can help you plan your expenses better.
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Frequently asked questions
Yes, most airports have ATMs, but they are often independent and charge high fees.
Yes, some airports have ATMs from local banks from the country you are visiting.
Airport ATMs tend to charge high transaction fees and conversion fees. Your bank may also charge an out-of-network fee and a foreign transaction fee.
Yes, you can order foreign currency from your bank before your trip, or use a currency exchange booth at the airport.
