Withdrawing money and withdrawing money abroad | Everything you need to know

In the Netherlands it is easy, you hold your card or phone against a device and then the debit card payment is arranged in no time. No conversions or cash. Unfortunately, you have to think about this more when abroad. For example, whether you can use your bank card to make debit card payments and whether you get any content from the ATM at all.

If you manage to pay by card and withdraw money, you are already one step further, but did you know that you almost always pay too much if you don't know exactly what you are doing?

Doing financial matters abroad is quite a challenge if you don't know anything about it. For example, do you have any idea what to choose if... Conversion is on the screen of the bank machine? And did you know that the costs for using your bank card and telephone PIN transactions can increase considerably if you do not use them wisely? In this article I will explain everything about money matters abroad and give you valuable tips, so that you can soon be confident at the bank machine!

Costs for cash withdrawals and PIN transactions

What many people do not know or forget is that every time you withdraw money or make a PIN transaction abroad, you pay for this. Costs can be high, especially outside the EU. Many Dutch banks are notoriously vague about what exactly it costs and it will take you a lot of effort to find out exactly what these hidden costs are. Below I will explain the costs you can expect if you pay or use your debit card abroad. Then more about how you can use tricks to save (a lot of) money. First of all, you need to know what different types of costs there are.

• Transaction costs when withdrawing money (for using the ATM).
• Transaction costs from your bank (because you pay by pin abroad)
• Conversion costs (so that your euros are exchanged for another currency when you withdraw).

Transaction costs when withdrawing cash

Almost every time you withdraw money from the wall outside the EU, it costs you money. The amount is determined, among other things, by the bank that owns the ATM. The costs usually vary from a fixed amount of a few euros to a percentage of the withdrawn amount. These costs can vary from 3 to 15 euros per transaction of 2% to 5% of the amount withdrawn. Some banks even ask for both! The costs then increase considerably.

If the costs are a fixed amount, it is cheaper to withdraw one larger amount instead of several small amounts, because you will then pay transaction costs less often.

At some ATMs, especially in popular places (such as a busy airport or square in a city center), these costs are often very high. El Nido in the Philippines is known, for example, for bizarrely high debit card fees – some machines charge up to 15 euros per transaction. Because many ignorant tourists do not know the local currency well, they often agree to it anyway. They often have no idea what it costs in euros and the local bank machines make smart use of this.

It is therefore wise to investigate during or prior to your trip what amounts specific banks charge. It is also worth visiting several ATMs yourself to see what the costs per transaction are. Sometimes there are even banks that do not or hardly charge these costs. If you see this at your destination, you already know that you have to be there!

For PIN transactions

Here too, there are major misunderstandings among Dutch people about the costs. Even if you use your normal debit or credit card to pay, you will have to pay transaction costs. You just don't see it. This is often 1 to 5 euros per transaction or 1% to 5% of the amount. Credit card supplier ICS is still fairly transparent about this, because you can here on their website read that even for regular PIN/payment transactions, 2,5% is added to the total amount. Other well-known Dutch banks, such as ABN Amro, have hidden their foreign transaction costs behind a vague calculator. You can see what it 'approximately' costs in total, but you can find little or no information about the hidden costs and actual conversion.

As you can see above in the ABN-Amro calculator, it costs 1000 AED us in Dubai about 260 euros. Below you can see what ABN thinks it would cost if you were to make the same PIN transaction in a restaurant or shop. It saves about 2 euros, probably because you don't withdraw cash from an ATM. In reality, however, the difference would be closer to 5 euros than two euros, but that's besides the point.

However, if I request exactly the same amount at the same time in Google, i.e. the current conversion, I arrive at 247 euros. So on average 10-15 euros cheaper. The 15 euro difference therefore remains somewhere between your bank and the foreign bank. But what exactly does that mean?

Conversion costs when withdrawing cash

There it is, the word Conversion, which you probably had doubts about at the bank machine. It is about this 'Dynamic Currency Conversion' (DCC). At ATMs you will be presented with a choice whether you want to continue with the conversion: 'continue with conversion' or whether you want to continue without: 'continue without conversion'.

Tip:: It is an option that is presented to you. There are people who think that if you choose without, the ATM will give you your bank card back, without cash. That is not true!

What matters is that the bank you use with your PIN makes you an offer. They offer to convert the money to the currency of your home country (i.e. to euros) at a certain rate. That rate will then be listed on your screen.

This conversion is almost never beneficial for you. If you want to save money, choose 'continue without conversion'. You still pay these costs for the conversion, but then to your own bank - the bank of your bank card. Nine times out of ten, your own Dutch bank charges lower costs (1-3%) or you even pay nothing at all (as with the Prepaid Credit Card from Bunq).

For PIN transactions

If you think it is cheaper to pay for every transaction with your debit card, then I'm sorry to disappoint you. You may only see the statement from your bank, but the transaction fee and conversion fee are already included in that amount, meaning you're actually paying more for each transaction than you think. Don't underestimate this!

For example, ING/RABO/ABN charge a standard 1,4% conversion fee for PIN payments in foreign currency - but you don't see this.

This is when withdrawing money 3,50 euros + 1,4% conversion costs, see for example the ING information page here... These are the costs of your bank exclusive the withdrawal costs that you will also see on your foreign ATM, usually +- 5 euros. If you do a quick calculation in your head, you will realize that at these banks you simply pay 10 euros each time you withdraw some foreign currency somewhere.

Example conversion costs

In the images below, which we recently made ourselves, you can clearly see the difference between the conversion rate of the Malaysian bank and your 'own' bank. In our case Bunq.

You see that the ATM offered me a rate of RM250 which would make the total amount in Euros 51,16. I declined this rate by 'continue without conversion' to choose, which caused my bank to charge his rate. This immediately made the cash withdrawal two euros cheaper. Compare the conversion on both screens!

Now you may think that is a small amount, at least if you only withdraw 50 euros. But during a long journey you will save yourself a lot of unnecessary costs, as long as you continue to refuse that offered conversion. Do not underestimate this: the two euro difference in the example above is more than 4%! For every 1000 euros that you 'convert', you lose 40 euros, just on the conversion and excluding the additional PIN costs (5-15 euros from foreign banks + 3,50 from Dutch banks).

An example of costs for cash withdrawals

Below are some examples of World Traveler Willie withdrawing money abroad.

World traveler Willie (who banks with ABN/RABI/ING) does withdraw money (the equivalent of 200 euros each time) twice a week for three weeks. Willie does not yet know that he has to refuse the conversion examples on the machine.

Withdraw money from ATM and ACCEPT conversion:

• Costs per foreign ATM withdrawal: 5 euros.
• NL bank costs per withdrawal abroad: 3,50 €.
• Currency conversion costs: +4% (if Willie accepts this on the machine).

Costs for 6 withdrawals of 200 euros: 51 euros (transaction costs) +
48 euros (conversion costs) = 99 euros in costs. In total, Willie loses almost 10% of the total amount he withdraws over three weeks.

Withdraw money from ATM and REFUSE conversion:

• Costs per foreign ATM withdrawal: 5 euros.
• NL bank costs per withdrawal abroad: 3,50 €.
• Currency conversion costs: + 1,4% (if you refuse this at the machine).

Costs for 6 withdrawals of 200 euros: 51 euros (transaction costs) +
22,40 euros (conversion costs) = 73,40 euros in costs.

Only by refusing the machine conversion, Willie saves more than 25 euros when withdrawing money. Yet a large part of the money is still lost.

Withdraw money from an ATM and REFUSE conversion WITH BUNQ

• Costs per foreign ATM withdrawal: 5 euros.
• Cash withdrawal costs abroad at Bunq: 0 euros.
• Currency conversion costs: 0% (as long as you have Bunq and refuse conversion on the machine!).

Costs for 6 withdrawals of 200 euros: 24 euros (transaction costs) +
0 euros (conversion costs) = 24 euros in costs.

By BUNQ's ZeroFX (0% conversion costs) and free debit card payments abroad 5 times a month, Willie saves 75 euros!

Paying everything by card is cheaper, but...

If Willie does not withdraw cash and pays everything by card, it may be cheaper for him. ING/ABN/RABO then only use the 1,4% about the amounts withdrawn (eg Bunq this is 0% by the way.

But anyone who travels a lot knows that using a debit card in distant places is still difficult. Firstly, our regular bank cards are often not accepted. In many countries a lot is still done with cash and it is becoming increasingly popular bank card skimming increasingly easier because small businesses have cheap ATMs that are very susceptible to fraud. You actually want to limit the number of PIN transactions abroad to a minimum, so that you simply run less risk.

Debit card, credit card or prepaid credit card?

Further to the fact that your standard bank card from the Netherlands may not be accepted outside the EU, it is good to know the differences between specific bank cards.

Debit card

It is often not possible to use your standard bank card (debit card) outside Europe. The bank blocks your card for security reasons, but conversely, banks abroad often do not accept debit cards. If you have planned a trip or holiday outside Europe, inform your bank that you will use your card during your holiday. You can often easily arrange this via your banking app. The bank will then ensure that you can use the bank card abroad while you are on holiday. Provided your foreign bank accepts your card, of course.

Tip:: At an ATM you choose 'with a debit card'withdrawal' which means recording. Then you choose 'savings'. Then you withdraw money from what is in your bank account.

Credit Card

You will often need a credit card in countries outside the EU. Consider a Visa or Mastercard bank card. When you use this card, you take out credit that you pay off later.

Tip:: Withdrawing money with a credit card works differently. At a bank machine you select 'withdrawal' which means recording and then you choose 'credit'. Then you take out credit and pay it off later.

Prepaid Credit Card

Then there is the Prepaid Credit Card, in our opinion the best option. A Prepaid Credit Card is a full-fledged credit card (for the outside world), but you do not borrow money, but just like with a debit card, you must first add money to it before you can use it. The big advantage of Prepaid credit cards are the costs. You do not borrow money, so you do not pay interest on the amount borrowed. Parties such as Bunq and Revolut also promote 0% conversion costs abroad, which can save you a lot of money if you travel longer or more often. Read our article about the differences between Prepaid Credit Cards take a closer look to find out more.

Our advice for traveling abroad:

Bunq Prepaid Credit Card

The Bunq card is the most accepted Prepaid Credit Card in the world. It's a full-fledged one Mastercard credit card - even offline terminals in airplanes and elsewhere work with this card (we have tested this many times ourselves). You can also rent a car with this card.

Pros:

• No BKR check
• Dutch bank
• Problem-free car rental abroad
• ZeroFX (abroad saves about 2-3% per transaction!)
• Works with Google and Apple Pay

Compare plans Our honest review

Other financial matters

Money exchange offices

You may be going to a country where cash is used a lot, ATMs are scarce and/or debit card transactions are unusual. It is then wise to withdraw cash from an exchange office. It is even wiser to do this before your trip.

There are in the Netherlands GWK exchange offices present at train stations and airports. If you order it in advance, you are assured of availability and they also offer you a favorable exchange rate (online) - even if you want to exchange the money back after your trip.

Tip:: We ordered from for our tour through America GWK online several thousand dollars in cash at a very favorable rate. We picked up at Schiphol airport, where our plane departed.

Follow currency rates

This may seem like too much effort - especially when traveling you don't want to have to deal with this too much - but I'll add it anyway. Tracking currency rates can save money. Today your euro, dollar or any other currency may be worth more or less. With this information, you could anticipate converting to another currency or making a big expense while traveling.

Example: In front of our tour of the United States the dollar was worth about 85 euro cents. The value of the Dollar rose during our trip to a point where the Euro and the Dollar had equal value. If we had taken extra cash at the start of the trip – because we pay for it in euros – it would have saved us a lot of money. For example, 1000 USD would have cost us 850 Euro at the time, 150 Euro less than during the trip.

Security at the ATM

You may have heard the following tips a hundred times. Yet I repeat them, because it would be extremely annoying if you became a victim of fraudsters.

• Protect your PIN code when using a bank or ATM machine.
• Before you insert your bank card into the ATM, check the card reader and the keyboard. You do this by looking and feeling whether anything unusual has been mounted on it.
• Look around you. There may be people watching you (and your PIN) or the skimming devices.
• Don't you trust it? Then do not use the ATM. Alternatively, you can go to a bank branch where these machines and the surrounding area are often better secured.

The tips summarized

Before your trip

• Familiarize yourself with the costs that your bank may charge, such as conversion costs for cash withdrawals and PIN transactions outside the EU.
• Research the transaction fees charged by different banks in the destination country.
• Take several bank cards with you when traveling.
• Familiarize yourself with the exchange rate of the currency of the destination country.
• Investigate the options for cash withdrawal and PIN transactions in the country of destination.
• Calculate whether withdrawing cash in advance at an exchange office in the Netherlands is cheaper.

During your trip

• Regularly check the debits on your banking app to see what you pay in conversion costs. You should also always be alert to transactions that you do not recognize (due to skimming).
• Choose an ATM from a bank that charges little or no transaction costs. If the transaction costs are too high, interrupt the transaction at an ATM and look for another ATM.
• Select when withdrawing money 'continue without conversion' for a better rate from your own bank.
• Use a Prepaid Credit Card if you want to spend the cheapest time abroad.
• Keep an eye on the exchange rate of the destination country's currency.
• Be alert to your safety at an ATM.

In conclusion

Now you've seen some examples and it's a lot of information. However, you now know that regular Dutch banks are actually very expensive outside the euro area. If you add up all the hidden and non-hidden costs, a month of traveling and paying will easily amount to 300 to 500 euros in 'payment costs' and this often happens completely under your radar. You can reduce this to less than 100 euros by choosing the right options at the ATM and using the right (prepaid) credit card.

Take these costs seriously!

By smart banking you save amounts that can be used to buy a complete plane ticket to someone else continent can book. It's a shame if you let this money go to waste every trip, isn't it?

Until the next blog!