Timeline for Why do the banks charge a foreign transaction fee?

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Jul 27, 2014 at 21:34	comment	added	littleadv		Anyway "because they can" always holds. Unless there's enough competition to drive prices down - they will go up. Because people don't have a choice, after all - we all travel.
Jul 27, 2014 at 21:32	comment	added	littleadv		It depends on the country and organizations. When I worked in the industry, the country I worked at had its own internal clearing house, which would only go externally for international transactions - and charge issuers for that. So foreign cards in that country would cost more to the issuers than at home, and foreign transactions for domestic issuers would cost more as well. Maybe something similar happened in the UK recently?
Jul 27, 2014 at 21:29	comment	added	Ion Ionascu		I don't really know, but my feeling is that there is no extra cost for the bank. The card operator acts as a clearing house and the bank never has to do anything about the foreign currency (apart from acknowledging it). I say this because up until 2 years ago or so, in the UK, most banks didn't have a fee for foreign transactions on debit cards. And now most of them have introduced one and the merchant fee has remained the same. I might be totally wrong, but I think the only reason is "because they can".
Jul 27, 2014 at 1:24	history	edited	littleadv	CC BY-SA 3.0	added 7 characters in body
Jul 27, 2014 at 1:15	history	answered	littleadv	CC BY-SA 3.0