Say NO To Fees: Foreign Exchange in Thailand


Getting Best Foreign Exchange Rates in Thailand


You’ll need Thai Baht to pay for your hotel, food, and other purchases in Thailand. However, when it comes to foreign exchange, banks make a hefty profit at your expense. Whether you’re using a “fee free” currency converters, an ATM card, or credit card, the banking industry is out to make money and lots of it.

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Foreign exchange is big business and big money. It’s a must to watch out for fees and other “gotchas”, as they add up quickly. For a number of reasons, most travelers are best off using a combination of currency exchange, ATMs, and credit cards for hotels and purchases. Luckily with the right ATM card and credit cards, you may say no to fees.

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Converting Cash at Foreign Exchange

This is popular among many travelers because they’re “fee free.” However, currency exchange is never free. While they may not have a per transaction fee, you can bet you’re not getting the best rate possible. That said, the rates provided are fair. In fact, some travelers may come out ahead depending on their bank fees for ATM or credit, but it’s not always a wise choice.

While cash is great, depending on cash for your entire trip is a huge risk. Obviously, theft or loss of your money makes it a bad bet. Unlike debit cards, credit cards, or even travelers checks, once cash is gone, it’s gone.

For that reason, some travelers prefer travelers checks, but they may attract fees to purchase as well as redeem, and like cash, you may not get the best exchange rate, but it’s typically fair.

Using Your ATM Card for Thai Baht

ATM networks often provide the best exchange rate available. Despite this, most travelers will get hit with a 200 THB fee per transaction ($5.50 USD) and your bank at home may impose fees as well. To start, many banks change a flat fee for using an ATM they don’t own and on top of that, you may get dinged an additional 2% to 3% for a foreign transaction.

For example, if your bank charges $4.50 USD per transaction and an additional 2.5% foreign exchange fee, you’re looking at $12.50 USD in fees for a 3500 THB transaction. As such, call your bank and ask about their fees. If the fees at your bank are too high, shop around.

Banking is competitive, thus depending on your account, some banks will reimburse you for out-of-network fees. Some financial institutions even provide fee-free options. For example, some Citibank account holders may obtain cash with no fees if using a Citibank ATM. Other banks offer similar programs for using an ATM machine at a partner bank. Even if you can’t get around the 200 THB fee, a fee free ATM card may save you a lot of money.

Finally, let your bank know when and where you’re traveling to prevent the possibility of declined transactions.

Credit Card Use and Foreign Exchange Rates in Thailand

Credit card networks likewise provide the best exchange rates. Like ATM cards, many credit cards also impose additional fees on foreign transactions.

Fortunately, there’s a growing number of card issuers now offering credit cards with no foreign exchange fees. First, see what fees apply to your existing credit cards for use overseas, it’s possible you may already have a fee-free card in your purse or wallet. If not, don’t fret, many large credit card issuers from Barclays to Capital One now offer Forex fee-free Visa and MasterCard credit cards. If you have good credit, obtaining one of these cards is a piece of cake.

Next, when making a purchase by credit card in Thailand, you need to be alert for two things. First, some merchants will attempt to add a surcharge for credit card usage. For the most part, large hotels, resorts, stores, or supermarkets, don’t engage in this. It’s primarily smaller businesses, but be alert for this.

Secondly, avoid the Dynamic Currency Conversion (DCC) Scam. Dynamic Currency Conversion is offered across the globe by merchant banks and is not limited to Thailand. With Dynamic Currency Conversion, you’ll be given a choice to pay for your purchase in your home currency with the price already converted. Never select this, it’s a bad deal and the exchange rate is sub-par. Sales clerks may try to push it on you “for your convenience” because both the business and bank profit from this shell game. Say no and be sure the sales slip you sign is in Thai Baht (THB) prior to signing it.

Plastic is Great With Forex Fee-Free Cards

In conclusion, you’ll likely find it best to use a combination of cash, ATM card, and credit card when traveling in Thailand. Obtaining a fee-free or low-fee ATM card is a great idea for any international traveler. Likewise, carrying major credit cards with no foreign exchange fees is wise. You’ll obtain the best exchange rate and avoid foreign exchange fees. Credit card acceptance is increasing in Thailand and Forex fee-free credit cards have the potential to save you a lot of money.

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