An international trip may require planning from months to even years, which involves doing research, scheduling, saving and more. As much as everything is planned, unforeseen happen and even if you want to avoid it, you can end up using your credit card abroad .
The international credit card is a practicality, has advantages such as points to redeem for miles for your next trip, is safer than carrying large amounts of money and is accepted almost everywhere. However, there is the 6.38% increase in IOF from purchases abroad, and in many cards the value is subject to conversion of the dollar with the quote at the time of invoice closing and not at the time of purchase, which may be It is a scare when the invoice arrives, because at the time of purchase you thought of a value in reais and at the time of paying can be considerably more expensive.
How does credit card use abroad work?
Even though the dollar is not the currency of the country the card was used in, most carriers convert the value first to the dollar and then to the real. For example, a purchase of $ 600 made on 10/19/2016 when the tourism dollar quotation is $ 3.32 would be converted on that date to $ 1992.00 + IOF. But if at the time of invoice closing the dollar is $ 3.50, for example, the purchase price will be $ 2100.00 + IOF.
Therefore, when making a purchase abroad it may be more advantageous to use cash or a prepaid card where the exchange rate will be set at the time of credit purchase.
Installment of credit card purchases abroad
If you have an international credit card, you can make your purchases abroad. However, the installment payment is not possible. Everything you purchase will come in one invoice or a maximum of two if part of your purchases are made after the credit card invoice close date.
What it takes to use the card abroad
If you intend to actually use your card while traveling, you need two things: Make it an international credit card, and let the bank or issuer know that it will be used for purchases abroad. This second need acts as a security measure for the bank to release transactions. In addition, if you have not entered a trip and someone uses your card in another country, the bank will be able to block the transaction more quickly.
Is it possible to leave debt abroad?
Debts made abroad may be charged in accordance with local rules under international law. Not necessarily a debt made abroad may be charged in Brazil, but upon return there may be a pending issue that may generate penalties to be met.
In some cases, however, the debt may be collected in Brazil.
Pay less than total invoice amount
When the full invoice amount is not paid, the customer is automatically contracting revolving credit for the remaining amount. The total rates (with IOF and etc.) of this modality is around 475% per year.
Install the invoice
Most card operators offer the option to split the invoice, the total invoice amount is divided by the amount of installments chosen with interest applied and the subsequent monthly invoices added. Although this option has lower interest rates than revolving credit, it can be dangerous to activate it without proper planning, as it is still a considerable amount in your budget every month.
Make a loan with lower interest rates
Most personal loans have lower rates than revolving credit. It is the most viable option for those who want to organize better without compromising the card limit.
As an interesting alternative there are companies that lend online at rates lower than the market average. Because they do not have physical branches, they have lower operating costs and are therefore able to make much more attractive loan proposals. This is the case of Loanico , which offers annual interest from 48.44% per year,
To avoid surprises, it is best to use your credit card sparingly when abroad. Joining a prepaid travel card is an option that gives you greater control over spending and even ensures your safety.