A fee frenzy

Question: While traveling in Peru for several months, I have been using my ATM card. No fees were ever disclosed. I have since learned that I have been charged an international transaction fee plus a $5 fee for each transaction. The combined fees have added up to hundreds of dollars. Trying to get a refund has been fruitless. Shouldn’t banks make customers aware of these fees?

Michael Evans

Cuzco, Peru

Answer: They do. Why, it took me only about 30 minutes of hunting on the bank’s website to find the answer. And when I contacted the bank (it happens to be Bank of America), I was provided this easy-to-remember website, https://www5.bankofamerica.com/search/Search.do?questionbox=Global+AT M+Alliance&searchSourceSite;=dotcom&searchSourceDir;=deposits&searchSou; rceReferer=%252Fdeposits%252Fchecksave%252Findex%252Ecfm&locale;=en_US , which essentially says that if you’re using one of the 12,000 banks abroad that belong to its Global ATM Alliance, the fee is waived. Unfortunately for Evans, none of these happens to be in Peru.

We’ve all grown accustomed to ATM fees, alas. But the international transaction fee still rankles. In this case, it’s 1% at the ATM and 3% at the point of purchase. Understanding the reason behind it helps put it in perspective.

These fees are a kind of insurance against fraud, said Ben Woolsey, director of marketing and consumer research for CreditCards.com, a card information and comparison website. Sometimes a merchant will accept a debit card and find out later that it was a fraudulent transaction. Your fees help offset that loss.

Woolsey doesn’t dispute the necessity of protection but thinks 3% might be a tad high.

So do Avi Karnani and Matt Wallaert, co-founder and behavioral psychologist, respectively, of the website Thrive (www.justthrive.com), which helps consumers (especially young ones) manage their finances and make sound choices.

They make two important points: Fees should be transparent, and they should make sense.

These aren’t and they don’t, the Thrive guys contend.

“I think again it comes down to understanding what you’re paying for,” Karnani said, adding that consumers understand taxes and fees because we already pay them on such items as airplane tickets. “The burden is on the bank to make sure that the individual knew about” the fees, he said.

Wallaert said, “He’s probably getting a bad exchange rate anyway, so they’re already making money.”

So there’s a practical answer here and there’s a philosophical one. If you’re traveling abroad, ask your bank about its transaction fees. If you’re going to be away from home for a long time, think about opening an account where you are (although that often can be fraught with its own difficulties).

And the philosophical question: Whose responsibility is it to know this? “They’re a bank -- that’s their job,” Wallaert said. “This is arguably the service they are providing.”

Perhaps. But in this day and age, I wouldn’t bank on it.

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