Visa and MasterCard are global brands. These emblems mark credit cards that are manufactured and used in virtually every country in the world. Visa and MasterCard logo credit cards are universally accepted regardless of whether they are issued by U.S. banks or banks outside of the United States.
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The American Express card, always associated with travel and entertainment, is also accepted worldwide and is the number three card in the world. It is also a direct company card and features its own merchant services program.
The fourth most often used credit card in the U.S.S is the Discover Card. This credit card, however, is generally not used or accepted outside of the United States and Canada. Interestingly, in the most recent customer satisfaction survey conducted by J. D. Power and Associates, the American Express credit card was ranked number one, closely followed by the Discover Card.
Applying for a Foreign Credit Card
You are certainly free contact an offshore bank and apply for their credit card, or contact a foreign-based bank located in the U.S. Nevertheless, the question is, do you want or need to add a foreign credit card to the growing stack in your wallet? It’s probably a good bet that for quick acceptance and clear and reasonable terms you’ll want to stick with a U.S.-based bank or credit card issuer.
That doesn’t mean however that you may not encounter some problems when traveling with your good old U.S.-issued credit cards. There can be significant differences between European cards and U.S. credit cards, and American travelers should be aware that their credit cards might not work in all situations while traveling abroad.
Differences with Foreign Credit Cards
The most significant difference in cards manufactured outside of the U.S. is that most new foreign cards are smart credit cards, utilizing the latest in microchip technology.
Most of the cards in circulation in the States today, still rely on the older magnetic stripe technology to encode customer data and account information.
According to a recent article posted on line by MSNBC, 130 countries have dumped the old magnetic stripe cards in favor of smart cards.
Most countries in Asia, Europe, and Latin America have already made the switch. Canada is in the midst of the conversion process. What does this mean for American tourists? It means that many ATMs and other unattended machines, may not accept your old-style credit card.
On the other hand, if you visit a store or other business with live attendants, they can input your credit card data manually and complete your transactions. To avoid unnecessary travel delays and other potentially embarrassing problems, travelers may want to carry some extra cash when practical, but the best remedy to resolve any potential credit card problems abroad is to plan.
Obtaining a smart card from a U.S. bank before your planned trip is probably the best advice. National banks like Chase, Wells Fargo, and U.S. Bank have all started issuing smart credit cards to their customers.
If your bank doesn’t yet offer them or you don’t qualify, another solution is to buy a Travelex chip and pin card. This is a MasterCard logo debit card, which can be loaded with pounds or Euros. A debit card from the Automobile Club of America works in much the same way and can be reloaded remotely from any AAA location.
Using a Credit Card When Traveling
The biggest issue for American travelers abroad is often the exchange rates for American currency. Carrying cash or travelers checks that have to be exchanged at a bank or currency office is a chore that can easily be avoided by using your MasterCard or Visa.
Each transaction is automatically converted to the new currency at the day’s market exchange rates.
The credit card rates are usually better than local bank rates and eliminate the need for an extra trip to the bank. In addition, you won’t have to carry as much cash.
When you do need cash, ATM transactions are converted to local currency in the same way as credit transactions. The requested amount of cash is deducted from your account in dollars and comes out of the ATM dispenser in local bills and coins.
A recent online article in USA Today, talks about how to best maneuver in a global smart card environment.
Advice includes carrying an extra credit card, and carrying at least one card with a four-digit pin, rather than an alphanumeric pin. These cards will be more readily accepted in foreign ATM’s, and other credit machines.
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