Discover charges no foreign transaction fees on purchases made outside the United States

Discover does not charge a percentage fee when you use your card to buy something in another country or online from a foreign merchant. This applies to all Discover cards — personal, student, and business — as long as the transaction is processed through Discover's network.

The catch is that not every merchant abroad accepts Discover. Visa and Mastercard are far more widely accepted internationally, so you may find yourself unable to use your Discover card in some places even though it would not charge you a fee if you could.

If a foreign merchant does accept your Discover card, the exchange rate you receive is set by Discover, not by the merchant. That rate is typically close to the mid-market rate (the rate banks use with each other), though Discover does add a small markup. You will see the USD amount on your statement after the conversion is complete.

Key Takeaways

  • Discover charges zero foreign transaction fees on purchases anywhere outside the United States, unlike many competitors that charge 2 to 3 percent.
  • Acceptance abroad is limited because fewer merchants internationally recognize Discover compared to Visa or Mastercard.
  • The exchange rate Discover applies is close to the mid-market rate but includes a small markup that Discover does not publicly disclose.
  • ATM withdrawals abroad may carry fees from the ATM operator or Discover, depending on your specific card and the country.

How the exchange rate works when you spend abroad

When you make a purchase in a foreign currency, Discover converts it to US dollars using an exchange rate that changes daily. The rate Discover uses is based on the mid-market rate — the rate at which major banks trade currencies with each other — but Discover adds its own markup to that rate. The exact markup varies and is not published on Discover's website.

You will not see the markup as a separate line item on your statement. Instead, you will see only the final USD amount. If you want to know what rate Discover used, you can compare the USD amount on your statement to the mid-market rate on the day of the transaction using a currency converter like XE or OANDA.

In practice, the markup is usually small enough that the lack of a foreign transaction fee still makes Discover competitive with cards that charge 2 to 3 percent per transaction. However, if you are making many small purchases abroad, the cumulative effect of the markup on each one can add up.

ATM fees when withdrawing cash overseas

Discover does not charge a fee for using an ATM outside the United States, but the ATM operator may charge you one. This fee comes from the bank or network that owns the ATM, not from Discover, and it typically ranges from $2 to $5 per withdrawal depending on the country and the specific ATM.

Some ATMs will show you the fee before you complete the withdrawal and give you the option to cancel. If you see a fee you do not want to pay, you can decline and look for another ATM. Many travelers find that withdrawing larger amounts less frequently costs less overall than making multiple small withdrawals.

Discover acceptance outside the United States

The main limitation of using Discover internationally is that many merchants do not accept it. Visa and Mastercard are accepted almost everywhere; Discover is accepted in fewer places, particularly in Europe, Asia, and Latin America. In some countries, you may find that only major hotels, airports, and chain restaurants take Discover.

Before traveling, contact Discover to ask whether your card will work in the specific countries you are visiting. You can also check Discover's merchant locator on their website, though it is not comprehensive. The safest approach is to bring a Visa or Mastercard as a backup, or to plan to withdraw cash from ATMs using your Discover card.

Comparing Discover to other cards for international travel

Most major credit cards charge a foreign transaction fee of 2 to 3 percent on purchases made outside the United States. Discover's zero fee is an advantage if you can use the card, but the limited acceptance abroad often outweighs that benefit. Visa and Mastercard cost more per transaction but work almost everywhere.

Some premium travel cards from other issuers offer zero foreign transaction fees and better rewards on international purchases, but they typically charge an annual fee. Whether that trade-off makes sense depends on how much you travel and how much you spend abroad.

For most people, the practical answer is to carry both a Discover card (for places that accept it) and a Visa or Mastercard (for everywhere else). This gives you the benefit of Discover's no-fee structure when you can use it, without leaving you stranded when you cannot.

What happens if a merchant charges you a foreign transaction fee anyway

Occasionally a merchant will add their own fee on top of the purchase price, separate from any fee charged by Discover or the card network. This is called a dynamic currency conversion fee or a merchant markup, and it is the merchant's choice, not Discover's.

When you see a prompt asking whether you want to be charged in USD or the local currency, choosing USD often triggers this merchant fee. Choosing the local currency and letting Discover do the conversion usually results in a better rate. If you are unsure, ask the merchant what the difference is before you complete the transaction.

Frequently Asked Questions

Will my Discover card work at ATMs in Europe?

Yes, Discover is accepted at many ATMs in Europe, though not all. Before you travel, ask Discover which ATM networks in your destination country accept Discover cards. You may also see a fee from the ATM operator, but not from Discover itself.

Do I pay a fee if I use Discover to book a hotel or flight online from a foreign website?

No. As long as the foreign merchant accepts Discover, you will not be charged a foreign transaction fee. Discover will convert the price to USD using its exchange rate, which includes a small markup but no separate percentage fee.

Is Discover accepted in Canada and Mexico?

Discover has better acceptance in Canada and Mexico than in most other countries outside the US, but it is still less widely accepted than Visa or Mastercard. Major retailers and hotels usually take it, but smaller merchants may not. Bring a backup card.

What if the ATM charges a fee I did not expect?

Most ATMs show you the fee before you complete the withdrawal and let you cancel. If you are charged a fee you did not authorize, contact Discover and explain what happened. Discover may be able to refund the fee depending on the circumstances.

Does Discover offer travel insurance or other protections when I use my card abroad?

Discover offers purchase protection and fraud protection on all cards, which apply to transactions made anywhere, including abroad. Some Discover cards also offer travel-related protections like emergency medical or emergency evacuation coverage. Check your specific card's benefits guide for details.