Effective March 15, 2018 the Amazon Visa will be no longer. The Amazon Visa was a popular credit card in Canada for foreign exchange purchases, and card I exclusively used for spending outside of Canda. Most credit cards charge a 2.5% surcharge on top of the foreign exchange rate when purchasing outside your domestic currency, but the Amazon Visa waived that fee, which was essentially a 2.5% bonus when shopping in foreign currency.
For example, if you are Canadian and travel to the US, most purchases while on your trip would be in USD. If you were to make the purchase with a typical credit card, the credit card would convert the purchase amount to your home currency (using the spot foreign exchange rate) AND add a 2.5% surcharge for the convenience of using a credit card. Maybe not a big deal at first, but if you regularly make USD purchases, the 2.5% surcharge is $25 for every $1,000 spent.
While the Amazon Visa was perhaps the most popular free option for cheaper foreign shopping, fortunately, there are other free options for Canadians. The picture on the top of this post may have given it away but from my research, there are three attractive credit cards in Canada that are efficient to use while traveling out of the country or making foreign currency purchases in general. Here are my favorites:
Best Credit Cards for Foreign Currency Purchases
This is a viable Amazon Visa replacement that has no annual fee and no foreign currency conversion surcharges. Like the Amazon card, it gives you 1% cash back as well. The only downside is that it is a little light on insurances, so not likely a great replacement for your regular everyday spending.
The Roadside assistance freebie looks like a nice addon but make sure to check out the details. From what I’ve read, it’s only 5km towing coverage which may not be enough.
Annual Fee: $0
- 1% CashBack with no limits to your total rewards;
- Roadside Assist membership at no extra charge;
- No foreign currency conversion surcharges;
- Purchase Security Insurance; and,
- Visa Auto Rental Collision/Loss Damage Insurance.
- Light on insurances.
This is a newish credit card offered by Rogers Bank, and really only geared towards Rogers customers. Technically, it may not belong in this list because it has a $29 annual fee, but the fee is waived if you charge a Rogers service to the card (the first year is free regardless).
What’s attractive about this card is the 4% cash back on foreign currency transactions, which works out to be a 1.5% net benefit after counting the 2.5% FX surcharge. What’s also attractive is the 1.75% cash back on everything else. For a pseudo-free credit card, 1.75% cash back is huge. Note though that the cash back accumulated is supposed to be used towards Rogers services, you can request a statement credit instead via telephone once a year.
Annual Fee: $0 if you pay your Rogers bill with this card $29 otherwise.
- 4% cash back on all foreign currency transactions (note that they still charge a 2.5% on fx, so the net reward is 1.5% on foreign currency transactions);
- 1.75% cash back on everything else; and,
- $29 annual fee waived if you charge a Rogers service to the card (first-year annual fee is automatically waived for all users).
- No insurance coverage.
- Cash back must be used towards Rogers products or phoned into Rogers Bank in December to apply the accumulated cash back as a statement credit.
- Must be Rogers customer to waive the annual fee.
The Fido MasterCard is very similar to the Rogers MasterCard above, but with slightly less cash back and no annual fee to think about. 4% cash back on foreign currency transactions, which works out to be a 1.5% net benefit after counting the 2.5% FX surcharge. This card also offers 1.5% cash back on everything else. Note though that the cash back accumulated is supposed to be used towards Fido services, and you may be able to get a statement credit instead by phoning in (like the Rogers card).
Annual Fee: $0
- 4% cash back on all foreign currency transactions (note that they still charge a 2.5% on fx, so the net reward is 1.5% on foreign currency transactions); and,
- 1.5% cash back on everything else.
- No insurance coverage; and,
- Cash back must be used towards Fido products or phoned into Rogers Bank in December to apply the accumulated cash back as a statement credit.
The competition for foreign currency purchases is pretty tight and the best card will depend on your specific circumstances. If you are a Rogers customer, I can see the Rogers MasterCard being more attractive than the rest. The same can be said for Fido.
At the moment, I personally use a combination of three free cash back credit cards. A capital one 1.5% cash back card (not available anymore) for my main spending; the 3% PC Financial World Elite Mastercard for grocery shopping (see promo below); and the Amazon Visa when traveling out of the country.
With the Amazon Visa going away and being an existing Rogers customer, the Rogers MasterCard is an attractive option not just for foreign currency purchases (4% cash back), but for everyday purchases (1.75% cash back). The only downside is the non-existent insurance coverage which is why I’d need to keep my Capital One card on hand.
However, if you aren’t using Rogers/Fido services, then the HomeTrust Visa really is an attractive option. It’s essentially the Amazon Visa with the extra benefit of light roadside assistance and car rental insurance coverage.
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If you are interested in the generous and free PC Financial World Elite MasterCard (3% cash back at Loblaws group of companies) mentioned above, check out the limited-time $100 gift card sign up bonus (plus $20 in groceries) if you sign up through Rate Supermarket. More details here.