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Amex vs Visa/mastercard

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Amex vs Visa/mastercard

Hi, we are going to St Barths in a couple of months and i was wondering if its best to pay( not withstanding cash) with Amex or mastercard/visa due to the exchange rate. At what point in the transaction is the exchange rate calculated... at the moment of transaction or when it hits the credit card? if someone is up on this information i would like to know what works best. thanks.

Pittsburgh...
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1. Re: Amex vs Visa/mastercard

Good question...

I advise people to NOT use AMEX for this reason. AMEX cards must be charged in dollars. This means that the merchant calculates the exchange rate (using whatever rate they choose.) They have no obligation to provide you the spot rate.

When you use Visa/MC, the rate is calculated at whatever the spot rate is at the time that the transaction posts. If the rate varies during your stay (it usually does a few cents at least) your rate will change. Visa/MC will also charge a fee to convert the currency. This rate depends on the card, usually between 2-3%. Capitol One has the lowest charge, at least for cardholders who got that agreement when they signed up. I think I saw its is changed for new cards, but you should check. Either way, its is much better to pay this fee rather than be hostage to a merchant's whim. Remember, 3% of $1000 is $30 so put it in perspective of the cost of the trip...

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2. Re: Amex vs Visa/mastercard

My Amex charges the spot rate plus a small% for the transaction. I generally get the best exchange rate on my Amex, 2nd best is a local ATM and 3rd would be travelers checks exchange into local currency.

Pittsburgh...
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3. Re: Amex vs Visa/mastercard

The currency charge for AMEX is 2% plus anything the issuing bank may add on, but most retails do not favor AMEX because of the high fees it charges to them. To recoup these fees, many merchants in SBH will simply do a currency conversion to favor them and charge the card in dollars. For this reason we avoid using our AMEX on St Barth.

Because our bank does not charge to us a "foreign" ATM (meaning any other bank's machine) we tend to withdraw Euros and pay cash for most purchases. You will have to figure out what the cost of using an ATM is based on your bank's fees. Usually it is slightly less than a credit card.

There is a currency exchange and several banks on the island, but given the cost of traveler checks, both to purchase and to cash, I would think this would be the most expensive option for getting Euros. They will also change US dollars, but with a hefty fee.

You can also take a $100 bill and make a few purchases at the Marche U, the island's largest market. They will give you your change in Euros and the exchange rate is just a few cents more than spot. Its right across from the airport. A quick way of getting some "walking around" money.

Edited: 30 April 2010, 02:49
NYC
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4. Re: Amex vs Visa/mastercard

This was all very helpful and insightful. If we decided to pay for most meals in cash, first, do the restaurants and shops take both USD and Euros?

If not USD, is it best to exhange the USD here in the states or when we arrive on the island. Thanks a lot.

Pittsburgh...
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5. Re: Amex vs Visa/mastercard

Ginger,

Its is best to pay in Euros. Like AMEX, if you pay dollars the merchant has the right to convert the cost from Euros at whatever rate they choose.

The best way to get Euros is from an ATM machine on the island. You will find ATMs in many places, two across from the airport, about five in Gustavia and one in Lorient shopping center.

Talk to your banker about the cost of using an ATM in the Caribbean versus the currency exchange cost. It will be obvious that changing money in the US is the most expensive way to get Euros. It will be equally expensive to change dollars at the SBH currency exchange.

Using an ATM also allows you to minimize the amount of money you have on you at any time.

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6. Re: Amex vs Visa/mastercard

bring alot of US $1-5-10. You can use them as tips for example instead of euros. To be truthfull we very rarely worry about exchanging for euros because we put most of our expenses; grocery, beach rentals, on the capital one card. the exchange rate is always competitive and there is no foreign transaction fee. just make sure you call them to let them know the dates you are travelling. If you really feel you must have euros in your pocket - while you are navigating the island find a merchant with a decent exchange rate ask for your change in euros.

St. Jean, St...
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7. Re: Amex vs Visa/mastercard

You will find that Amex is not widely accepted, the reason being, unscrupulous travelers pay with Amex, dispute the charge/quality of the service and the money is taken back from the merchant's account before any complaints procedure has even been started.

There is a story of one person who stayed a full two weeks on St Barts, paid everything he could on his Amex, got back to the States and said "It wasn't me"

NYC
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8. Re: Amex vs Visa/mastercard

Hi - now that the dollar is a lot stronger than it was when i previously asked my question; do you still advise not using Amex due to how they work the exchange rate? going to St Baryhs in 3 weeks and we want to try to capitailze on the stronger dollar - . what do you think? Thanks

Pittsburgh...
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9. Re: Amex vs Visa/mastercard

Ginger,

If you reread the posts, you will see that it is NOT advisable to rely on an AMEX card on St Barth for the following reasons:

It is not widely accepted.

Merchants can opt to charge you in dollars at a conversion rate of their choosing.

Neither of these facts changed just because the Euro has declined against the US dollar.

You will absolutely benefit from the improved exchange rate by using a Visa or MC. It will be charged in Euros and the credit card company will convert to US dollars using the spot rate. Your card will charge a fee for this.

As my husband says, you are best off using the "coin of the realm" in most places, unless it is significantly disadvantaged against the dollar (think pesos.)

Point Pleasant, New...
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10. Re: Amex vs Visa/mastercard

My husband and I will be arriving next week and wanted to inquire if any establishments accept bank debit cards. This would solve the extra fees the credit card companies charge.