CONSUMER TRAVEL

Visiting abroad? Plastic in paradise

If you're heading outside of the United States this summer, get your plastic ready. There have been some changes -- some to your benefit, some not so good.

Basic rule. Put your big charges on a credit card and use an ATM (debit) card for the local cash you need. Even with the fees, you lose less on foreign exchange using plastic than by exchanging currency. But some details have changed.

Chips ahoy. Most of the developed world outside the United States has switched to "EMV" cards that use an embedded chip to contain account information, while issuers in the United States have stuck with the magnetic stripe. Chip-card issuers outside the U.S. have also adopted a system that requires users to enter a PIN rather than sign a chit for personal verification. Almost everybody considers the chip-and-pin system to be more secure.

Most U.S. credit card issuers plan to switch to chip-enabled or "EMV" cards by October, but your bank may not issue a new card in time for your trip. Many travel-oriented cards are now available with chips. You can request an updated chip card. But your bank may not accommodate you.

Most U.S. card issuers have opted for a hybrid chip-and-signature system, which, experts say, is less secure than pin cards. As a result, you may encounter compatibility problems even with a chip card. The most serious problems occur when your only payment option is an unattended vending system. For the most part, older signature credit card, stripe or chip, and magnetic-stripe ATM card will be accepted anywhere you interact with a salesperson. In my recent overseas trips, most automated vending systems accepted my chip and stripe signature credit cards, and most bank ATMs accepted stripe debit cards.

Only a few U.S. cards are chip-and-pin. Among them, says CreditCardForum.com, are credit cards from Barclays, Wells Fargo and Synchrony and a few debit cards.

Recently, when a reader tried to buy a ticket online, the Norwegian Railway website refused his credit card because of "inadequate security." Instead, he had to use PayPal. If you aren't already signed up, PayPal can be useful when you run into credit card problems, and for sending money. It does, however, add a foreign exchange surcharge of about 2.5 percent.

More no-surcharge credit cards. If you don't already have such a card, check with the various card comparison websites for a card that best meets your needs.

Airport ATM exchange gouge. Most large airports in Europe lately have replaced ATMs operated by legitimate banks with ATMs operated by foreign exchange companies. They prominently feature signs claiming "no withdrawal fee," but they hit you with a really bad exchange rate -- as bad as you get at the nearby exchange counter. Before you plan to use an airport ATM, check with your system's online ATM locator to find ATMs operated by legitimate commercial banks, even if they're outside the main terminal.

Global ATM Network loses edge. Banks really hate to give consumers a good deal. So the Global ATM Network, which previously allowed Bank of America account holders to get foreign currency in much of the world with neither a fee nor an exchange surcharge, now charges a 3 percent conversion fee. That means you're better off with a debit card from one of the banks that absorb some or all foreign ATM transaction fees, including Ally Bank, USAA, several investment firm checking accounts, several online banks, and many small banks and credit unions.

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Travel on 04/26/2015

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