Discover It Card has no foreign transaction fees on purchases made outside the United States

The Discover It Card does not charge a foreign transaction fee when you use it to buy goods or services in another country or online from a foreign merchant. This means the card's exchange rate and the purchase amount are the only costs you pay — Discover does not add a percentage on top for processing the transaction internationally.

This is one of the card's main advantages for people who travel or shop from overseas retailers. However, the lack of a foreign transaction fee does not mean the card works everywhere abroad, and there are other costs to understand before you travel.

Key Takeaways

  • Discover It Card charges zero foreign transaction fees on purchases made outside the United States.
  • The card's exchange rate is set by Mastercard (Discover uses Mastercard's network internationally), and that rate may differ from your bank's rate or the mid-market rate.
  • Discover It Card is accepted in fewer countries than Visa or Mastercard, so you may not be able to use it at all merchants abroad.
  • ATM withdrawals outside the United States may carry a fee from the ATM operator, even though Discover does not charge a foreign transaction fee.
  • Some foreign merchants charge a fee to convert your purchase to their local currency, which is separate from Discover's foreign transaction fee policy.

How Discover's exchange rate works when you travel

When you make a purchase in a foreign currency, Discover converts it to US dollars using the exchange rate set by Mastercard on the day the transaction is processed. This rate is usually close to the mid-market rate (the rate banks use with each other), but it is not the same as the rate you would see on a currency converter or your own bank's rate.

The difference between Mastercard's rate and the mid-market rate is how Discover makes money on international transactions, even though it does not charge you a separate foreign transaction fee. The markup is typically 1 to 2 percent, though it varies by currency and transaction. You will see the converted amount and the exchange rate used on your statement after the transaction posts.

Where Discover It Card may not work abroad

Discover is accepted in far fewer places outside the United States than Visa or Mastercard. In Europe, Asia, and many other regions, many merchants, ATMs, and payment terminals do not recognize Discover at all. Before you travel, contact Discover to ask about acceptance in the specific countries you plan to visit, or check their merchant locator on their website.

If you rely only on Discover It Card abroad, you risk arriving at a merchant or ATM that will not take it. Most travel advisors recommend carrying a Visa or Mastercard as a backup, even if you plan to use Discover for most purchases.

ATM fees and cash withdrawals outside the United States

Discover It Card does not charge a foreign transaction fee when you withdraw cash from an ATM abroad, but the ATM operator may charge you a fee. 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 ATM operator.

Some ATMs will also offer to convert your withdrawal to US dollars on the spot (called dynamic currency conversion). Decline this offer — the conversion rate the ATM offers is almost always worse than Mastercard's rate, and you will pay more in the end.

Dynamic currency conversion and merchant fees

Some merchants abroad, especially in tourist areas, will offer to charge your Discover It Card in US dollars instead of the local currency. This is called dynamic currency conversion. The merchant sets the exchange rate, and it is almost always worse than Mastercard's rate. Decline and ask the merchant to charge you in the local currency instead — Discover will convert it at Mastercard's rate, which is better.

Separately, some foreign merchants charge a fee to process card payments at all, or charge a higher fee for foreign cards. This fee is set by the merchant, not by Discover, and Discover's lack of a foreign transaction fee does not protect you from it. Ask the merchant about their fee before you complete the purchase.

Comparing Discover It Card to other cards with no foreign transaction fees

Several other cards also have no foreign transaction fees, including many Visa and Mastercard options. The main difference is acceptance: Visa and Mastercard are accepted almost everywhere abroad, while Discover is not. If you travel frequently or to countries where Discover is not widely accepted, a Visa or Mastercard with no foreign transaction fee may be more practical, even if the exchange rate markup is similar.

Some premium cards offer additional travel benefits like trip cancellation insurance or emergency medical coverage abroad, which Discover It Card does not include. If you travel often, compare the full feature set, not just the foreign transaction fee policy.

Frequently Asked Questions

Will Discover It Card work at ATMs in Europe?

Discover is accepted at some ATMs in Europe, but not all. Acceptance varies by country and by ATM network. Before you travel, contact Discover to confirm which countries and ATM networks accept Discover, or plan to carry a Visa or Mastercard as a backup.

Do I pay the foreign transaction fee if I shop online from a foreign website?

No. Discover It Card has no foreign transaction fee for online purchases from foreign merchants, just as it does not for in-person purchases abroad. The only cost is the exchange rate conversion (if the purchase is in a foreign currency) and any fee the merchant charges.

What is the exchange rate Discover uses?

Discover uses Mastercard's exchange rate, which is set daily. The rate is usually within 1 to 2 percent of the mid-market rate. You can see the exact rate and conversion amount on your statement after the transaction posts.

Can I avoid the exchange rate markup by paying in US dollars abroad?

Some merchants offer to charge you in US dollars (dynamic currency conversion), but their exchange rate is usually worse than Mastercard's rate. You will pay more by accepting their offer. Always ask the merchant to charge you in the local currency instead.

Does Discover charge a fee if I use the card to pay a bill in another country?

No foreign transaction fee applies. However, the company you are paying may charge a fee to process a foreign card payment, or may only accept certain card types. Check with them before you attempt the payment.