MasterCard; Officially Better FX Rates than Visa

Lz0s0 on 03/04/2017 - 07:32

TL;DR: Your "no-FX-fee" Visa card is actually charging you 0.5%.

Over the years we've often been discussing the merits of Visa vs MasterCard on Whirlpool (where I have also posted this), OzBargain etc. For many years I've been traveling with a 28 Degrees MasterCard and the Citibank Plus Visa debit cards. Sure, they're both "0% foreign exchange fee" cards, but I've certainly noticed that the MasterCard seemed to offer slightly better rates than the Visa.

Well, I decided to do some data collection and research, and I've recently pushed it onto a website to allow for an easy comparison.

Take a look:
https://fx.sycuse.com/visa-mastercard/

Some interesting results came about; firstly that MasterCard always offers a better FX rate than Visa – as we suspected. But the magnitude of the difference has fallen significantly since November last year.

Visa's FX spread implies a commission of – on average 0.5%, whilst before November 2016 MasterCard took just 0.02% (!!). MasterCard have sadly been increasing this since late last year, and it now averages (for AUD/USD) 0.2%. That's a ten-fold increase; but still much better than Visa.

Financial

Comments

  • jimbobaus on 03/04/2017 - 08:53

    my Citibank Visa Debit has better rates than the new Citibank Mastercard Debit
    I believe Citi sets the rates on their cards directly, as you can check them on the citi website anytime and thats the rates you get.

    • z0s0 on 03/04/2017 - 10:32

      I'd be interested to hear more about this; as I have got a new Citi MC debit on order (and still have a Visa one for another account).

      I'll do some testing next month; but in the meantime do you have data or a source on Citi not using MasterCard's rates for this?

      EDIT: Oh you mean these rates? https://www.citibank.com.au/aus/investments/forex-rates/AUD.…

      They are exceptionally bad; and certainly not the rates which we've been getting with the Citi Visa Debit for ATM withdrawls etc.

      If this change has indeed occurred with Citi's new MasterCard issue, then this is a big deal for many Ozbargainers who rely on it for FX purchases & cash withdrawals.

      Are you able to provide an transaction history screenshot that confirms this? I think we'd all be keen to confirm this.

      • jimbobaus on 03/04/2017 - 14:18
        +1

        wow those rates suck lol
        they are def not the rates we getting on our cards.

        I am at work but will try and link some screen shots.
        The partner and I both subscribe to the same service which bills in USD

        I was charged $16.55AUD and my partner paid $17.22 on the MC
        We have noticed a couple other instances also.

        Will try and send something though tonight

        • z0s0 on 03/04/2017 - 15:52

          Cool. The other interesting thing to check will be if ATM withdrawals get the same rates as credit card purchases. I'm starting to suspect that they do not; and perhaps never have. I will take both cards O/S in a few weeks, so I'll be able to run some tests.

  • peterpeterpumpkin on 03/04/2017 - 08:56

    Thanks for the data. It looks like the Buy and Sell curves are mixed up for Mastercard when the USD / Australian Dollar radio button is selected.

    • z0s0 on 03/04/2017 - 10:33

      Thanks for the feedback; could you elaborate; eg. screenshot? Not sure what you're referring to.

      • peterpeterpumpkin on 03/04/2017 - 13:12

        Sorry, can't screenshot, at work right now.

        I meant when the Currency Pair is set to USD / Australian Dollar in the settings below the chart, the orange line for MasterCard is consistently higher than the red, when as one would expect, the data table in the top right shows that red (sell) is always higher than orange (buy).

        • z0s0 on 03/04/2017 - 15:51

          Ah, right you are! Thanks for that!

  • forumninja on 03/04/2017 - 12:01
    +3

    Thanks z0s0. Awesome work.

  • Multipass on 04/04/2017 - 00:59
    +1

    Thank you for your post!

    I checked my ANZ Rewards Travel Adventures (AMEX) vs 28 degrees, both have no foreign transaction fees and for transactions dated 21/3, its 0.7644 (28deg) vs 0.7662 (Amex) and for 22/3, its 0.763 (28deg) vs 0.7713 (Amex).

    It is interesting to know that Amex has better exchange rates than Mastercard.

    • z0s0 on 04/04/2017 - 11:46

      That is indeed interesting. I'll have to see if I can get a data source for AMEX.

      I actually wasn't aware that any AMEX card issuers were doing "no FX fee".

  • smith001122 on 18/06/2017 - 14:50

    Any update on this?
    I've used 28 degrees for many years and have just got myself a Citibank transaction account. I'm going overseas in July and would be interested to hear what happened with your spend. Thanks

    • z0s0 on 20/06/2017 - 21:37

      The summary from my testing is; use 28 Degrees (or the Citi MasterCard debit card) for CC purchases wherever possible, instead of withdrawing cash.

      The rates for ATM withdrawals are not quite as good as the credit card purchase rates.

      And: always choose MasterCard over visa for credit card purchases. But, for Citibank ATM withdrawals, the Visa seems to offer very slightly better rates. But this will be irrelevant soon as the Visa has been dropped in favour of the MasterCard.

      • smith001122 on 21/06/2017 - 12:03

        Thanks for your reply.
        I only have a Citibank MC debit so that's a shame that the visa offers a better rate as I will only use my 28 degrees for cc purchases and my citi debit card for atm withdrawals. Oh well, such is life :)

Login or Join to leave a comment
Login Join