How to Avoid Foreign Transaction Fees on Your UnionBank Credit Card When Traveling
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How to Avoid Foreign Transaction Fees on Your UnionBank Credit Card When Traveling
✈️ Introduction: The Hidden Fee Most Travelers Miss
You’ve booked your flight, packed your bags, and you’re ready to explore a new country. But when you get your next credit card statement — surprise! There are extra charges you didn’t expect.
These hidden costs are called foreign transaction fees. They’re small, but they can add up fast — especially if you’re using your UnionBank credit card frequently while traveling abroad.
For first-time credit card users in the Philippines, understanding these fees is crucial. By learning a few smart habits and using the right tools, you can avoid unnecessary costs and make the most out of your card’s benefits while you enjoy your trip.
💳 What Are Foreign Transaction Fees?
A foreign transaction fee (also known as a forex fee) is a charge added to your purchase when you use your Philippine-issued credit card abroad or online with a non-Peso merchant.
Even if the price is shown in PHP, the transaction may still go through a foreign payment processor — triggering the fee.
💡 Example:
You use your UnionBank credit card to buy $100 worth of souvenirs in Japan. The exchange rate converts that to ₱5,800. If your card has a 3% foreign transaction fee, you’ll pay an extra ₱174. Total cost: ₱5,974.
Now imagine shopping, dining, and booking hotels — that’s hundreds or even thousands of pesos lost in fees over your vacation.
🌍 How Credit Cards Work Abroad
When you use your UnionBank credit card overseas, your purchase goes through a global payment network like Visa or Mastercard. The system automatically converts the amount from the local currency (USD, EUR, JPY, etc.) to Philippine pesos when it appears on your billing statement.
During this process, three things may happen:
Currency conversion at the network rate.
Network service charge (Visa or Mastercard).
Bank fee (UnionBank’s own foreign transaction charge).
All of these combine to create the total “foreign transaction fee.”
⚠️ Types of Hidden Fees to Watch Out For
Not all fees abroad are obvious. Here’s what to keep an eye on:
1. Foreign Transaction Fee
This is the main fee, usually 2%–3.5% of the total purchase. It’s automatically added when your card is used outside the Philippines.
2. Dynamic Currency Conversion (DCC)
When a cashier or website offers to charge you in pesos (PHP) instead of the local currency, it sounds convenient — but it’s not. DCC uses the merchant’s exchange rate, which is almost always worse than your bank’s rate.
💬 Pro Tip: Always choose to pay in the local currency to save money.
3. Cash Advance Fee
Using your credit card for cash withdrawals abroad can be costly. Expect:
A cash advance fee (around 5%)
Immediate interest charged daily
💡 Example: If you withdraw ₱10,000 abroad, that’s ₱500 in fees — plus interest starting the same day.
🧠 How to Avoid or Minimize Foreign Transaction Fees
Here are practical, proven ways to save more when traveling with your UnionBank credit card.
🏦 1. Choose a Card with Lower or No Foreign Fees
Some UnionBank cards, particularly premium travel cards, offer lower forex rates or even waive them. If you’re a frequent traveler, consider upgrading your card to one with travel perks and better conversion policies.
💬 Example: If you often fly for business or leisure, cards like the UnionBank Miles+ Platinum Visa are designed for global use, with perks such as airline rewards and lower foreign exchange costs.
📱 2. Inform UnionBank Before Traveling
Before your trip, log in to your UnionBank Online App and inform them about your travel plans. Why? This helps:
Prevent your transactions from being flagged as suspicious
Keep your card active for international use
Enable travel protection features (for eligible cards)
You can do this easily under Card Settings → Travel Notification inside the app.
💱 3. Always Pay in Local Currency
Whenever you’re asked:
“Would you like to pay in pesos or in USD?”
Always say local currency. It’s one of the simplest yet most effective ways to avoid extra conversion charges.
Remember: Paying in pesos abroad is not “free of fees.” It’s often more expensive because of DCC.
🪙 4. Estimate Your Total Travel Spending with a Calculator
Before you go, use the 👉 Credit Card Cost Calculator to see how much your overseas purchases may cost after conversion and fees.
This free tool helps you:
Compare PHP vs foreign currency spending
Estimate your final bill
Plan your travel budget more accurately
💬 Example: If you’re traveling to Japan and plan to spend $1,000, the calculator can estimate your total cost in pesos (including a 3% forex fee) — helping you plan your finances better before your flight.
💸 5. Avoid Cash Advances Abroad
Using your credit card for cash withdrawals overseas should be your last resort. Instead, bring a small amount of local cash for emergencies and rely on your credit card for purchases.
Remember:
Cash advances charge interest immediately
You’ll also pay a service fee per withdrawal
Use your UnionBank card mainly for secure purchases, not for cash.
🔒 6. Enable Security Features in the UnionBank App
UnionBank’s mobile app lets you control your card in real time. You can:
Lock/unlock your card anytime
Enable international transactions only when needed
Get instant alerts for every purchase
💬 Example: If you lose your card in Bangkok, you can lock it instantly to prevent unauthorized charges — no need to call customer service right away.
🧾 7. Track Your Expenses in Real Time
When traveling, it’s easy to lose track of what you’ve spent. UnionBank’s app updates your transactions and currency conversions in near real-time. Check it daily to avoid overspending and surprise fees later on.
✨ Example: How Small Fees Add Up
Let’s say you use your UnionBank credit card for a 5-day trip to Singapore.
Purchase Type
Amount (PHP)
Fee (3%)
Total
Food & Dining
₱15,000
₱450
₱15,450
Shopping
₱20,000
₱600
₱20,600
Hotel
₱10,000
₱300
₱10,300
Transport & Others
₱5,000
₱150
₱5,150
Total
₱50,000
₱1,500
₱51,500
That ₱1,500 could’ve been your airport transfer, travel insurance, or extra meal abroad — wasted just on hidden fees.
🧍♀️ For First-Time Credit Card Users
If you’re new to credit cards, especially UnionBank cards, remember:
Always read the card’s terms and fees before use.
Notify your bank about your travel plans.
Monitor your expenses daily through the app.
Pay your balance in full when you return to avoid interest.
💬 Simple tip: Treat your credit card as a tool for convenience and safety, not for borrowing cash abroad.
🚫 Common Mistakes to Avoid When Traveling with Your Credit Card
❌ Paying in PHP instead of local currency
❌ Forgetting to inform UnionBank before travel
❌ Withdrawing cash with your card
❌ Ignoring SMS/email alerts about overseas use
❌ Paying only the minimum amount due after your trip
Avoid these, and your UnionBank credit card becomes your best travel companion, not your most expensive one.
📋 How to Check Your UnionBank Credit Card’s Foreign Fee
Here’s how to confirm your forex rate:
Log in to UnionBank Online App
Tap Credit Card → Card Settings
Select Fees & Charges
Look for Foreign Currency Conversion Fee
This lets you see exactly how much is charged per overseas transaction.
🧾 TL;DR (Too Long; Didn’t Read)
Foreign transaction fees are usually 2%–3.5% of your purchase abroad.
Always pay in local currency, never in pesos, to avoid DCC markups.
Avoid cash advances — they’re the costliest form of credit card use overseas.
Check your UnionBank app regularly for real-time updates and security alerts.
❓ FAQs: Foreign Transaction Fees on UnionBank Credit Cards
1. How much is the foreign transaction fee for UnionBank credit cards?
It usually ranges from 2% to 3.5%, depending on your card type and the Visa or Mastercard network used.
2. How can I avoid paying foreign transaction fees?
Pay in local currency, choose a card with lower forex rates, and use tools like the Credit Card Cost Calculator to plan ahead.
3. Can I use my UnionBank credit card anywhere abroad?
Yes, as long as the merchant accepts Visa or Mastercard, depending on your card’s logo. Just make sure to enable international use in the UnionBank app.
4. Is it safe to use my credit card abroad?
Yes, as long as you:
Use trusted merchants
Avoid public Wi-Fi for payments
Lock your card in the UnionBank app if it’s lost
5. Does UnionBank offer cards with no foreign transaction fees?
Some premium or travel-focused cards may waive or reduce fees. Ask your UnionBank representative for available options.
✈️ Final Thoughts: Travel Smart, Spend Smarter
Foreign transaction fees can quietly drain your travel budget — but with awareness and planning, you can avoid them entirely.
Your UnionBank Credit Card is powerful for overseas travel — it’s secure, convenient, and accepted worldwide. Just remember:
Pay in local currency
Plan with the Credit Card Cost Calculator
Track expenses through your UnionBank app
Whether you’re dining in Tokyo, shopping in Seoul, or exploring Singapore, being fee-smart means you enjoy more memories and fewer hidden costs.
💳 Travel smart. Swipe wisely. Enjoy worry-free spending anywhere in the world.
