What is the cheapest way to convert currency?According to CardHub’s Currency Exchange Study, a credit card provides the cheapest form of currency conversion. As long as you’re using a credit card with no foreign exchange fees that is on the Visa or MasterCard network, you’ll save up to 7.9% and 14.7% on currency conversion relative to cash services offered at local banks and airports, respectively. Besides being cheapest, credit cards also provide the simplest means of currency conversion, given that it’s done automatically upon a purchase being made.
Please keep in mind that 90.2% of all credit cards have an average foreign transaction fee of 2.45%, according to CardHub's data. That’s what makes planning ahead and getting one of the credit cards with no foreign transaction fee so important. Capital One used to be the only real player in this niche credit card category, but a number of other major issuers--including American Express, Chase, Citi and HSBC -- have since started offering credit cards without foreign transaction fees.