Bank fees, card costs, savings products or home loans... Wondering which bank you should choose? We explain it all to you!
Have you ever travelled outside the Euro zone? Then you probably know that there can be some unpleasant surprises when you return from your holiday. Not least because of the many bank charges abroad.
Withdrawals, local currency exchange, card payments... Here's an overview of the main foreign bank charges you'll be charged. We'll also give you some tips on how to avoid paying them on your next trip.
When you go to a country outside the Euro zone, banks usually charge several types of fees. These are as follows:
The values given here are only examples. Each establishment has its own fee schedule regarding bank charges abroad. The amount may therefore vary from one bank to another in Luxembourg.
Some banks also offer specific advantages abroad (free withdrawals, no commission for payment by card in a foreign currency, etc.).
We advise you to consult your bank's tariff brochure to make sure you know what the charges are before you travel. This will help you to anticipate and avoid them.
Now that you know the main bank charges abroad, here are some tips on how to avoid them when travelling.
It is better to withdraw a large sum of money at once than to make many small withdrawals. This is because, for each withdrawal in a foreign currency, you will have to pay a fixed fee. The more you do, the more you will pay.
There are two ways to reduce these costs:
In some shops abroad, the card payment terminals will offer you the option of paying in Euros or in the local currency.
In these cases, merchants have agreements with foreign exchange companies to offer payment in the cardholder's currency. But, with this solution, exchange rates are very high. If you don't have too many bank charges on card payments abroad, we advise you to always choose to pay in the local currency.
This means that your bank will apply its charges. The advantage is that you will know them in advance. You won't have any nasty surprises.
To find out more about this practice of some retailers outside the Euro zone, see this article.
Some banks offer options that cover the costs of conversion, withdrawal or payment abroad. For an extra ten or twenty euros per month, you can carry out your transactions freely, without any additional costs.
This option is particularly interesting if you often travel for work. However, not all banks offer this option: check with your banker before you travel.
To avoid any unpleasant surprises, more and more people are opting for an account without bank charges abroad. Many neo-banks have developed mobile 100% offers with a bank card a priori free of charge abroad. Among these banks, the best known are
You can open an account for free from your phone in most European countries.
But beware, Contrary to popular belief, these accounts are not 100% without bank charges. Depending on the neo-bank you choose, you could have :
In general, these fees are still lower than those charged by most traditional banks. However, we advise you to analyse their offers in detail before opening an account.
Finally, if you prefer to opt for a better bank in Luxembourg, do not hesitate to consult our offer selection.
Check your bank's fee schedule. You will be able to find the charges for withdrawals from a third-party ATM, the charges for withdrawing money outside the Euro zone, and the charges for paying with a card in a foreign currency. If you can't find the price list, contact your banker and ask for the fees.
You can opt for a travel option with your bank: you will pay an extra fee each month, but you will not have to pay a fee for every card withdrawal and payment abroad. You can also open an account with an online bank such as N26 or Revolut, but contrary to popular belief, these accounts are not 100% free of foreign banking fees.
If you often travel abroad, you can opt for an N26 or Revolut account. These two new banks offer low banking fees abroad. However, be sure to read the terms and conditions carefully: depending on the account you choose, you may still have to pay withdrawal, exchange or card payment fees. Also, depending on your country of residence, bear in mind that you will have to declare this account to the tax authorities in your tax return.
If you have a Luxembourg credit card, you can pay abroad without any problem. However, you may be charged commissions and exchange fees for each payment made in a foreign currency. Ask your bank or consult your account's price list to find out about these foreign bank charges.
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