I know there is a separate thread about Schwab Visa card, but I thought this topic might require a separate thread because a lot of people use the card overseas hoping not to be charged any exhcnage fees. The thing is Charles Schwab sure doesn't separate the exchange fee on the statement and looking at the statement you will think you are not charged the exchange fee; however, this might not be the case. From what I can see they play a game with the exchange rate. Here is just the most recent example from my statement.
04/24/09 Transaction in Russia for 5576 rubles
Charles Schwab statement shows:
04/24/09: $168.17
This means they converted the total in rubles at the rate of 33.1569 RUB/USD (5576/168.17=33.1569). So now I go and check what was the actual interbank rate for that day (e.g. http://www.oanda.com/convert/fxhistory), and I see that was not 33.1569 but actually 33.7993. The difference is roughly 2%!!!
So yes, there is no exchnage fee on the statement, but Chrles Schwab does lower the exchange rate by 2% which is basically the same thing as a 2% exchange fee.
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posted: Apr. 26, 2009 @ 9:00p
MyDiscoverSucks
Member
posted: Apr. 26, 2009 @ 9:19p
Oanda is a bucketshop, so I don't know how accurate their records are. But anyways BoA sent out a mailing saying they were changing the terms, and I believe there was something about FX rates. So if it did change, it might be recently because of FIA/BAC hardships. Maybe you should ask Schwab if they're still eating the FX fees.
mttatkns
Thrifty Member
posted: Apr. 26, 2009 @ 9:21p
Are you comparing the exchange rate on the transaction date or posting date? That may make a difference. I can tell you from personal experience that a 2% lower exchange rate is not experienced across the board. Here are two examples from a recent trip to the Netherlands, using the site you referenced to obtain the official interbank rates:
03/25 transaction / 03/27 posting: 53.75 EUR; $72.93 for 03/25 rate 1.35960 = $73.08 for 03/27 rate 1.35740 = $72.96 In both cases, I'm better off than the official interbank rate!
03/27 transaction / 03/30 posting: 90.00 EUR; $120.53 for 03/27 rate 1.35740 = $122.17 for 03/30 rate 1.32930 = $119.64 This time, I'm better off than the official interbank rate on the transaction day, but slightly worse off than the official interbank rate on the posting day. Still, the difference is less than 1%.
YMMV, but Schwab does not universally lower exchange rates by 2%.
mttatkns
Thrifty Member
posted: Apr. 26, 2009 @ 9:24p
MyDiscoverSucks said: Oanda is a bucketshop, so I don't know how accurate their records are. But anyways BoA sent out a mailing saying they were changing the terms, and I believe there was something about FX rates. So if it did change, it might be recently because of FIA/BAC hardships. Maybe you should ask Schwab if they're still eating the FX fees.Schwab is not BOA, and bank-charged forex fees are usually broken out as a separate line item on one's statement. Schwab has not changed the verbiage on their website. I do not think there has been any change.
From what I understand, the exchange rate is set by Visa everyday based on the previous day's spot rate. So comparing to the spot rate on a given day doesn't tell you whether Schwab was charging a forex fee. Here is Visa's exchange rate website: http://www.corporate.visa.com/pd/consumer_services/consumer_ex_r...
Rubles are not listed but most other major currencies are.
MyDiscoverSucks
Member
posted: Apr. 26, 2009 @ 9:43p
Schwab is not BAC, but they are using FIA which is owned by BAC if that makes a difference.
4myfamily
Senior Member
posted: Apr. 26, 2009 @ 10:23p
I just received an Amendments to credit card agreement from Schwab and there are changes pertaining to Foreign Transaction Fees. Keep an eye out for the info.
busterbaxter
Senior Member - 1K
posted: Apr. 27, 2009 @ 12:27p
4myfamily said: I just received an Amendments to credit card agreement from Schwab and there are changes pertaining to Foreign Transaction Fees. Keep an eye out for the info.
would appreciate it if you can summarize the term change here. Am going to apply for the card and the pending changes could sway my decision.
Just an FYI here (perhaps more common knowledge than I realize, but I'll err on the side of information -- Only the new Schwab 2% CashBack card charges no foreign exchange fee (unless the new Amendments say otherwise, which would be disappointing). The old Schwab card (WorldPoints) does. A helpful rep brought that to my attention a few weeks ago.
silam
Senior Member
posted: Apr. 28, 2009 @ 9:42a
I haven't received any literature stating a change in the 0% FX fee and I purchased something in GBP 2 days ago and the math worked out to 0%.
vovito
Senior Member
posted: Apr. 29, 2009 @ 2:44a
Smooth said: Just an FYI here (perhaps more common knowledge than I realize, but I'll err on the side of information -- Only the new Schwab 2% CashBack card charges no foreign exchange fee (unless the new Amendments say otherwise, which would be disappointing). The old Schwab card (WorldPoints) does. A helpful rep brought that to my attention a few weeks ago. I received mine two weeks ago. So I assume mine is new, and still there is a big discrepancy in the exchange rate.
dblevitan
Tired Member
posted: Apr. 29, 2009 @ 2:49a
I received notices from my other BofA/FIA cards (Fidelity 1.5% and Fidelity 2.0%). But not for Schwab yet.
vovito said: So yes, there is no exchnage fee on the statement, but Chrles Schwab does lower the exchange rate by 2% which is basically the same thing as a 2% exchange fee.
Given the legal history and court settlements about 'unstated' forex fees, I'd be surprised if CS hides a 2% exchange fee. They would be sued immediately, and they would lose, esp after publically stating it's 0%.
I think what you are seeing in variation in market rates, timing of the exchange, etc. I have never used rubles, but are they as liquid and freely traded on open markets as pounds and euros?
I've used the CS card in several countries now, and have never seen a forex fee. Nor has CS or FIA contacted me about changing that part of their T&C.
vovito said: 04/24/09 Transaction in Russia for 5576 rubles
Charles Schwab statement shows:
04/24/09: $168.17
This means they converted the total in rubles at the rate of 33.1569 RUB/USD (5576/168.17=33.1569) You should check the official rate with the Russian central bank for the rate on the previous day which was 34,0597
My experience with Russia was that private banks there charge their ATM fees as procentages on the total transaction by adding it to the amount. Therefore it will be unclear what the transaction amount was. As Chack refunds such fees usually automatically, I called and asked how would they do about it. They advised me to submit them the receipts with the amount in Rubles circuled and they would process them manually. However, I was not able to test it on practice as they cancelled the card as soon as overseas transaction was attempted and required to call a specific department within them for further investigation. So I used USAA who did not refund such ATM fees.
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