Travel: Foreign Currency

Although it is possible to buy and sell foreign currency in Canada, there are often significant fees.  I usually buy foreign currency at an airport ATM on arrival.  In the past, I had a debit card that only charged a small currency conversion fee, but they raised the fee to the typical 2.5% a few years ago.  

I have a travel credit card that charges no currency conversion fees.  To avoid the higher interest rate on cash withdrawals, I pay off any outstanding balance and add enough funds to cover the foreign cash withdrawal.  I recently signed up with EQ Bank that also charges no currency conversion fees.  They provide a reloadable bank card that ATMs treat as a credit card. 

On top of charging a transaction fee, some foreign ATMs "offer" to convert to the currency of your credit card, similar to the "service" provided by PayPal when making foreign purchases.  This is rarely a good idea.  It pays to look up the current exchange rate and estimate what your bank will charge.  In one case, the cost of letting the ATM convert was almost 14% more than what my bank actually charged me.