Find out when it’s worth to use your international travel credit card
Your long awaited vacation is coming and you have already closed that trip to a destination that will provide you with unforgettable moments of rest and leisure.
All set to take off? If your destination is to go beyond the borders of Brazil, know that you must plan very well the forms that will use to make your purchases and payments. Thus, avoiding surprises and even need to make an online personal loan to pay the bills.
Here are some tips to find out when it’s worth your while to use your credit card internationally and when it’s better to use other means.
When to use a credit card when traveling internationally?
The basic charge levied by the Brazilian government on the purchase of foreign products and services with your credit card is the so-called Tax on Financial Transactions, or IOF. For each use of the card outside the country, your purchase will have an increase of 6.38% in the total amount.
An example: you are in the United States and decided to purchase new sunglasses. For the quotation of the dollar, your purchase goes for R $ 200.
However, with the collection of the IOF, the price of such glasses will have an increase of R $ 12.76. That way, your new product will have a total cost of R $ 212.76.
In the simulation above, we speak of “dollar quotation”. When using your credit card in international transactions, it is crucial to remember to convert the value of the product into a real one.
By contracting an international credit card, this is one of the rules that will be conditional upon use. Certain operators offer to carry out the conversion by the quotation of the payment date of the invoice.
Others, however, turn the dollar into the real using the quotation in effect on the day of the closing of the invoice. Thus, the actual purchase value is uncertain for the customer at the time of the transaction.
Type of dollar
Another rule that goes into the credit card agreement is the type of dollar that will be used for the conversion. In general, financial institutions use the so-called commercial dollar, which has a lower quote.
However, the contract may establish the use of tourism dollar, which usually has higher value against the real.
So, as we have said on other occasions, be aware of the contract you are going to close with the bank to get a new credit card.
What about international prepaid cards?
Many tourists choose to use a prepaid card offered by Brazilian banks. The amount paid to the institution is available for use abroad with the amount in reais already converted to the currency of the foreign country to be visited.
A few years ago the IOF tax for this type of transaction made abroad was equivalent to that of the credit card: 6.38%.
Thus, the credit card can become a more secure ally during the trip. Your cancellation in case of loss or theft can be much simpler than that of prepaid mode.
For any trip you make, whether inside or outside Brazil, it is important to take certain amount of money in kind. Depending on where you are, an ATM may not be available 24 hours a day, and using paper currency may be the only solution accepted by certain establishments.
But it need not be alarmist: there is no need to take risks by carrying large amounts with you.
When traveling abroad and using cash, the IOF tax is 1.1% per transaction. And be aware of the price of exchange offices: buying the international currency still in Brazil may be more advantageous
Do not leave your credit card at home
Whenever you are traveling, have your credit card close by. You never know when you will come across that product you both want available for a special price.
In addition, the security and convenience for this type of transaction are two differentials that count many points in favor of its use.
And an important final tip: when leaving Brazil, do not forget to ask for the unlocking of the card, informing the administrator by which countries you intend to pass, this may avoid future unnecessary headaches.