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I rarely take out money when abroad, as I try to keep all my purchases on credit cards. Since I’ve always had accounts that levied steep fees for ATM withdrawals, I’ve always exchanged money in advance of my travel. Unfortunately, you generally get rates between 1.5-5% less than the interbank/market rate depending on the establishment you frequent. Recently, I’ve dug into a few bank accounts that are quite useful for travellers who want to save when converting currency.
In terms of credit cards, the only products that do not incur foreign exchange fees are issued by Chase Canada. These include the Chase Marriott Visa and Amazon Visa, and I highly recommend them for anyone who currently are paying forex on their purchases abroad.
Chase Canada Marriott Visa
Avoiding foreign ATM fees when withdrawing cash is a different story. While credit cards max out at 2-3% in forex surcharges, you can get hit heavily when taking money out overseas.
Foreign Bank Fees
There are three main fees that you pay for an international withdrawal at a non-affiliated ATM. Your bank will charge you a fee for making an international withdrawal, and also potentially a foreign exchange fee. The ATM machine may also charge you a additional fee for using their terminal.
Bank Withdrawal Fee + Foreign Exchange Fee + ATM Fee
With the Big 5 Banks in Canada (BMO, TD, CIBC, RBC, and Scotia), most of their standard checking accounts have a $5 fee associated with Foreign ATM withdrawals, as well as a 2.5% foreign exchange fee. If you add another $3 fee from the ATM machine, you’re losing about 13% for every $100 withdrawal, an insane cost to get your own money out of the bank.
The best option with the major banks is Scotiabank, a member of the Global ATM Alliance. While coverage isn’t complete around the world, you’ll at least save when using the member bank’s ATM’s in places like the UK, the Caribbean, Oceania, and the US. You also have access in parts of Europe, Africa, and South America. If you have a Scotiabank Account, the Bank Access and ATM machine fees are waived, but you still incur the 2.5% forex fee.
This is also the case with top-tier All Inclusive/Premium plans. Even though they trumpet no-fee ATM withdrawals, the fine print in their terms and conditions mention that all foreign currency transactions (including international withdrawals) are subject to a 2.5% fee. While you do end up saving the ATM access fee, the extra dollars you’re paying is especially unfavourable with withdrawals in large amounts.
Alternative 1: Tangerine Checking
Tangerine Checking
The best bank account in Canada to have for foreign withdrawals is with Tangerine, a direct bank with limited brick-and-mortar retail presence. There are no fees and no minimums on the account at all, since they aren’t a full-service bank. However, since they are owned by Scotia, customers get to tap into the worldwide network without having the accompanying maintenance fees and surcharges. It’s a fantastic loophole for those in the know (which you are now!).
Tangerine Refer-A-Friend
The best part is that they’re also offering a Refer-A-Friend Bonus with a free $50 cash bonus for signing up for an account and depositing $100, if you use my signup code 44400167S1 (otherwise you receive nothing). You must put in the Orange Key referral code during the signup process. Otherwise, you won’t receive the bonus.
Inserting Orange Key
You’ll receive the referral bonus as soon as you deposit the funds in the account. The bonus showed up for me quite quickly – in one calendar day! It’s probably the quickest bank account bonus that I’ve ever seen.
$50 Tangerine Bank Account Bonus
With an international ATM withdrawal that’s non-network, there’s a flat $2 fee. While painful, that’s still better than most banks. Do note that this card runs on the Cirrus/Interac networks and not Visa/MasterCard, so acceptance may also vary. I’ve listed here all the members of the Global ATM Network.
Global ATM Alliance Members
For some people, this will suffice as you can get American/Australian/New Zealand dollars, Pounds, Euros, and a variety of other currencies fee-free. However, for those who do want the unicorn bank accounts with both no international withdrawal surcharges as well as ATM fee rebates, you’ll have to go looking in a country without universal health care the US, with accounts denominated in USD.
Alternative 2: Charles Schwab
The Charles Schwab High Yield Investor Checking Account is the gold standard recommended by all my American friends, and is the account that is most often referenced by miles/points sites. It comes with a linked Brokerage account, but there’s no requirement to actually use it. There are no fees for withdrawals, and you’ll also receive unlimited ATM rebates on from any ATM worldwide. There are also no monthly fees nor minimum balances required, and is probably the most economical option out there.
Schwab Bank No ATM Fees
The only snag for Canadians are that a US Social Security Number and a US address is required for opening the account. Thankfully, I’m lucky enough to have one. But there’s no need to fret if you don’t.
Alternative 3: TD Premier Checking
This was a recent discovery, as I was looking through the US-affiliated subsidiary of the Canadian banks. TD Bank USA is based in Maine with a retail branch presence throughout the East Coast. Similar to TD in Canada, who holds the contract to issue Aeroplan’s co-branded Visas such as the TD Aeroplan Visa Infinite (see my review), TD Bank issues USD denominated Aeroplan credit cards.
TD Bank No ATM Fees
Their Premier Account is their top of the line Checking option, which also rebates all non-TD ATM fees. However, the account requires a monthly $25 fee, waived with a balance of $2500 USD. USD savings accounts will pay 1% interest at most, so you’re foregoing roughly $25 annually by leaving your money with TD instead of in a Savings account.
If you’re like me though, you’ve probably made back the fee within one trip. I ended up making four withdrawals during a two week trip – in Dubai, Beijing, Doha, and Mexico City. I’ve yet to see a fee rebate for the Mexico City ATM that was the only one which levied a surcharge on their own, but we’ll see.
TD Premier Signup
This might be the best option for most Canadians, as there’s a page specifically targeted for Canadian residents, accessible through this link. You’ll be able to put in your Canadian Social Insurance Number as well as a Canadian address. To fund the account the easiest way is through a TD Canada Trust wire transfer. If you don’t already have a USD account, TD will take 2-4% on the conversion from CAD.
What Account should I Choose?
The debit card issued by both US accounts is a Visa, so worldwide acceptance is pretty universal. Deciding which account to open merely depends on your personal situation.
Everyone should get a Tangerine account. It’s free to maintain, and you get $50 to start with Orange Key code 44400167S1, doubled from the regular offer. This runs only until April 30th, so jump on it now. As long as you’re using the right banks, you’ll be able to withdraw currency for free.
Tangerine Orange Key
The TD account is also a good option. However, you need 2500 USD to start, which may be an an issue if you need to convert Canadian Dollars, as the CAD -> USD exchange rate is quite poor at the moment. Also, if you’re far away from a TD USA retail branch, it’s a bit of a hassle as TD branches in Canada are unable to provide banking services such as changing PINs, depositing funds, or issuing new ATM cards.
If you do have an SSN, I would recommend opening a Schwab account as there are no minimums required. Do keep in mind that there’s a hard inquiry on your credit report when you first sign up. Other than that though, there are no monthly fees or minimums, and the sentiment and comments online about Schwab is very positive.
Right now, I have all three accounts, although I’ve been primarily using my TD account. I have yet to try firsthand a withdrawal with my Schwab or Tangerine card, so will definitely report back when that happens. Most likely, I’ll ATM withdraw USD from my Canadian Tangerine account at a Bank of America ATM, then move the USD funds over to my TD account for other international currencies. It’s complicated, but most likely the cheapest way for me to get my foreign currencies when I’m travelling!
Application Details
To apply, use these following links:
- Tangerine Checking (make sure you use Orange Key 44400167S1)
- Charles Schwab High Yield Investor Checking
- TD Bank USA Premier Checking
Do you have any other ways you withdraw your money with travelling?
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Hi Jeff,
Can I still get the Charles Schwab without a US SIN?
Not sure whether they accept ITIN’s.
TD Canada trust all inclusive account waives atm fees, and so does the BMO premium plan (but up to five in a month)
Seems more relevant to Canadian readers than US alternatives. Keeping 5k cad in a local account is much more feasible (payroll, bill payments, safety deposit box) than 2.5k USD in a foreign account which would not be used often
Even though the ATM fee is waived, there’s a 2.5% foreign exchange fee on all non-CAD transactions, including international withdrawals. It’s pretty unfavourable especially if you withdraw in large amounts.
The TD US visa charges 3 percent foreign transaction fee, and when I was setting up my premier checking account I expected that atm withdrawals at non USD machines would have the same 3 percent worse exchange rate.
With my TD premier account ATM withdrawals, they pretty much match the interbank rate as shown on Google, Visa, xe.com, etc. You are correct in that the TD USA Visa has forex.
Jeff,
You should talk about the trick to overpay a Chase Canada Visa and then use it at an ATM abroad. You only get charged the $5 cash advance fee with no interest and no spread over the interbank rate.
Eh, I’d rather use my Schwab or TD accounts.
Sure, but those are both USD options, and not as “efficient” for most Canadians who primarily hold CAD.
Thanks nabeelj, I was thinking about that as an option and was going to do a test run. Your info is much appreciated.
BTW Tangerine *does* charge a foreign transaction fee. You can call them and they will gladly clarify this for you.
I was told they don’t – we’ll see when I make a withdrawal.
I’m interested in your results, please reply here after you test.
So, did Tangerine end up charging the foreign transaction fee?
I’m also curious to hear if Tangerine charged the foreign transaction fee. I just called and spoke with a representative from Tangerine who assured me there was administration or foreign transaction fee charged. If the foreign ABM used does not belong to the Global ATM Alliance, Tangerine will charge $2 for withdrawals. Additional fees will be charged by the foreign bank to whom the ABM belongs (which is standard). By comparison, CIBC charges $5 for foreign ABM withdrawals plus an additional 2.5% administration fee
Correct, Tangerine is only advantageous if used at one of their partner ATM networks.
My apologies, there was a single word missing in my initial comment which changes everything. To clarify:
I just called and spoke with a representative from Tangerine who assured me there was NO administration or foreign transaction fee charged.
In other words, Tangerine remains advantageous even at ABMs that are not apart of the Global ATM alliance as you will only be charged the $2 fee and any charged by the foreign bank. The standard 2.5% admin fee (as charged by CIBC et al) will not apply even if the ABM is not apart of the Global ATM alliance.
I have spoken to multiple Tangerine representatives who have confirmed this each time.
Just came back from Paris. Withdrew 100 euro from NBP Paribas ABM, which is part of alliance. I was hit with a foreign transaction fee + 2 euro transaction fee.
Here are my findings, hopefully you will find it useful.
All transactions happened on the same day 10/22/2015
-Tangerine ABM – Exchange rate 1.52 + 2 euro (Worst)
-CapitalOne Aspire MasterCard 1.5028
-Accu-rate.ca 1.4937 (rate on that day)
-Amazon Visa (no foreign transaction fee) 1.491 (Best).
It makes sense to charge everything on Chase Visa card as you get the best rate plus 1% cash back.
Wow, that’s a horrible rate. I’d call Tangerine and get the euro fee waived though.
That agrees with my experience from mid-2011. Tangerine is deceptive about the fact that they do charge foreign transaction fees.
Another foreign exchange thing I recently discovered is that when booking a hotel, you can have the web site show the rate in CAD (using approx. the Xe.com conversion rate). However, AMEX will charge your card in USD and then convert it with the 2.5% surcharge. Visa will use the CAD amount as indicated in the hotel website (Agoda). Agoda advises of this but have not noticed other sites do it–when the flag came up advising what AMEX would do, I just changed to VISA and no problem. Anyway, saves the 2.5% conversion fee!!
I’d personally use the .ca version of the booking site to avoid possibility of forex fees.
It’s not true that you “receive nothing” if you don’t open a Tangerine account through your link. Their regular offer is $50. $25 upon open and $25 for 6 months of putting $100 into the account. so you get $50 plus 2.4% interest on the account for 6 months if you want to deposit more.
I was referring to a Checking account. You don’t get an ATM card with a savings account, so that was irrelevant for the purpose of my post.
Everyone knows the purpose of your post, which is to push your agenda for referral links. This blog is a pathetic excuse. 2/3 of the options are for USD accounts, yet you want to appeal to a Canadian reader?
You’re easily able to get a Tangerine and TD USA Bank account as a Canadian resident. The Chase Marriott Card I’m referring to in the post is also the Canadian version.
I was in Peru for 3 weeks and had no problem using my Scotiacard with Scotiabank, so no atm fees. HOWEVER tangerine, which claims to work on the scotia global network only worked in one scotia ATM out of 10 or 15 different locations I tried. Sooo I wouldn’t rely on tangerine as my only plan when traveling.
Thanks for the info.
Another option is to get a Zenbanx account. On one hand they have one of the best currency exchange rates out there. On the other hand you can use your debit card abroad (once you’ve exchanged CAD to your desired currency) in that country and withdraw money for only a $3 fee.
Pushing US accounts is really not in the interest of readers. Unless you have a US income, you still have to exchange CAD to USD somehow. Zenbanx, BMO or TD’s plans are much more practical, or cash advances from the Amazon Visa for a 1% (minimum $5) fee.
But then again, you can’t push referral links with those actually helpful options…
As I mentioned in previous comments, both TD and BMO both charge 2.5 in forex fees even with an premium bank account. Why would I pay $5 on a cash advance fee when I can withdraw for free from Tangerine? I’d hope that most intelligent readers had converted CAD to USD when the loonie was stronger a few years ago.
No mention of the PC Financial account? I’d be curious how that one stacks up.
Add another data point for Tangerine. I too was led to believe it was a better deal to use their card travelling and in Spain at Deutsche Bank I ended up getting dinged $21.36 on a withdraw of 400 euro. It shows up on line as a withdraw from Scotiabank with no breakdown. Stick with converting travellers cheques at the banks along the way. Bit more of a hassle but saves a few $$$.
Wow David, that’s really sneaky. I’ll investigate this further and will let everyone know once I have more information.
Any more information on this? I plan on using Deutsche bank in Spain soon.
I spoke with Tangerine, and they just say that the rate depends on what Deutsche Bank set for that day. I tried to find rate online, and it looks like they mark-up 30% – it doesn’t see right. But here is their table,
https://forms.deutschebank.co.in/DBForms/private/ViewRates
Personally I have Tangerine Bank and its amazing for GlobeTrotters i am not sure why others didnt have the same experience abroad..
My Recent Trip to Japan i wanted to test my new card and I was charged the following:
20-Aug-2016 Usage Charge by CIRRUS -2.00
20-Aug-2016 Withdrawal – International JAPAN -65.70
I took out 5000 Yen which was 77.88 per C$ shown at Xe…. So technically i should be charged $64.20 but got charged an extra 2.28% or C$1.50 which i assume was charged by the Japanese ATM. Tangerine saved me a lot…. its seem like the only bank in Canada that doesn’t charge a Foreign Currency Conversion Fee while the rest including PCF charges 2.5%.
I wish we had something Similar to Charles Schwab here in Canada; and like the writer mention the best alternative is having TD Premier Checking but for this to be any convenient we need a source of $US Funds and willingness to put away US$2500 every month. So i believe other than Tangerine the best Alternative is having a no foreign transaction fee Credit Card which you have to pay up in advance; so time to apply for the Chase Amazon Visa Card.
Will I end up doing US tax return with IRS for opening US TD Premier Checking?
You should talk to an accountant about this as I’m not qualified to answer, but in my experience I don’t think so.
I was wondering if you knew anything about using PC Financial outside of Canada, specifically in the UK and Ireland. In the past I’ve been advised by PC to use Barclay’s ATMs in England and Scotiabank ATMs in South America to avoid some fees but is this a global ATM network thing rather than a special PC option?
I think you might be talking about Tangerine, who are part of the Global ATM alliance. If you use your tangerine card at a partner bank worldwide no atm fees by the operator are levied.
Since April 2017
Tangerine has equal 2.5% charge a Foreign Currency Conversion as any other international credit card
I’m not referring to their credit card but rather their bank ATM card.
It seems that the Amazon Visa card is being discontinued. The application form has gone from the Amazon website. Too bad, because this was a good card to have (no annual fee, (No FX fees and 1% cash back on all purchases.) However the Chase Marriott Visa card website is still accepting applications.
If you have a Rogers or Fido cellphone, an even better card might be the Rogers or Fido MatserCard issued by the Rogers Bank. They still charge 2.5% FX fee but then you get 4% rebate on all foreign purchases. The catch is that you have to spend those rebates with Rogers/Fido.
Nigel, a couple clarifications:
For the Rogers Bank card:
a.) you can ask for an annual statement credit to be paid in January. You have to ask each year, but you don’t need to spend your cash back on Rogers or Fido.
b.) The cash back is on purchases while the Chase Amazon was recommended for its no F/X charge on ATM withdrawals. Those are 2 separate types of transactions, the Rogers Bank card has no advantages for the purpose of ATM withdrawals.
1) Amazon Visa 1% is great for purchases AND also for Cash advance from international ATM. BUT I HATE HOW IT DOESNT COME WITH PAPERLESS SO ITS A BIG NO!
2) Rogers/Fido 4% less 2.5% FX is ONLY good for purchases not for Returns where u will lose l% and NOT good for cash advance or International ATM withdraws because u dont get cash back applied so u lose 2.5%
I recently opened a Convenience Checking Account from TD USA which requires min deposit of $100 USD for monthly $15 fee waived.
For my Trip to the Philippines this was what I got billed:
08/02/2017 DEBIT NONTD ATM FEE $3.00
08/02/2017 ATM DDA WITHDRAW CEBU CEBU P HL $736.04
I withdrew 37000 Peso which XE rate that day was: US$734.45 + US $1.59 was taken from foreign Bank ATM bank. So u can see TD Bank debit card is great since they have 0% FX fees they even say it in their website. I found that my tangerine Debitcard doesnt mention anything so i cant be confident that its 0% FX fees.
Secondly, I highly suggest getting the TD CASH CREDIT CARD (USA) it also has a 0% FX fee and u get a 1% on everyday purchases should work like ur Amazon Visa card but denominated with USA Dollars.
Withdrawals with our 2 Tangerine cards are not working in ScotiaBanks ATM’s in Mexico (Playa del Carmen) despite the fact we try all the ScotiaBank ATM’s in the city.
Withdrawals with other ATM’s are working with our Tangerine cards.
We called Tangerine and they said to us they know the problem and they are “working on it”.
They will pay all the fees we will have with others ATM’s when we will return to Canada (in a couple of months…).