Credit card fees and how to (mostly) avoid them

Posted in Banking tips
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In terms of fees, most of your day-to-day use of your credit card probably won’t cost you any more than your annual card fee. Here’s the low-down on other fees that could apply, and ways to avoid them.

Annual fee

This one’s pretty difficult to avoid. Depending on the type of credit card you have, it could be as low as about $30 (for a low fee card) and up to $300 a year (for a premium card ). Usually, the more features a card has – like rewards points and complimentary insurances – the higher its annual fee.

If your card has features that you’re not using, it might be a good time to change your credit card to something with a lower annual fee. Read about the important questions when choosing the right card for you.

If you are a NAB shareholder or you have a home loan package, you could be able to get a credit card with no annual fee (although you will pay an annual package fee).  Make sure you check; this could save you plenty!

Convert points to credit to cover your annual fee

Some cards can earn you FlyBuys points on purchases. If you earn enough points, you can redeem them for credit back onto your card. Some of our customers earn enough points to cover their annual fee, or more.

You can read more about redeeming points for credit card funds on the FlyBuys website.

Cash advance fee

Put simply, cash advances are expensive, so save them for emergencies only. Our cash advance fee is a percentage of the amount you advance, meaning the larger your cash advance, the higher your fee. It’s a one-off fee for each cash advance, but interest charged is also from the day you access the funds until it’s paid off in full.

So make sure you know what counts as a cash advance – withdrawing cash is not the only way. Get the details in our post avoiding credit card interest (Part 1).

Late payment fee

This fee explains itself: if you’re late with your monthly credit card payment, you’ll see this fee on your next statement.

To avoid this fee you need to at least make your minimum payment by the date shown on your statement. (When you read about avoiding credit card interest you’ll see that making the minimum payment is not enough to avoid interest.)

We’ve reduced this fee to $5, which is less than a lot of other banks, but you’d still probably prefer to avoid being charged at all, right?

Setting up a regular payment could help you to ensure you are never late on your payments. You can read more about this in avoiding credit card interest (Part 2).

International transaction fees

Depending on the type of credit card you use (Visa®, MasterCard®, or American Express®) and the exact type of transaction, this fee can vary. But it’s always a percentage of the total you spend (usually between 1.5% and 2.5%).

You don’t have to be overseas for this fee to apply. If you’re an online shopper, remember that any purchase you make with an international store or in any international currency (like USD or GBP) will attract an international transaction fee.

Repeat statement fee

This is much less common than the other fees we’ve just gone through, but it’s important to cover every possible fee.

If you ask us to post you a copy of an old credit card statement, we’ll charge you a fee. The easiest way to avoid this is to set up Smart Statements online through NAB Internet Banking. You can download statements for an open account going back as far as seven years. See How to set up Internet Banking.

Fees for non-NAB ATMs

These technically aren’t “credit card fees”, since they apply no matter what sort of NAB card you put in the machine. You’ll probably have to pay a fee if you use an ATM other than a NAB ATM or rediATM to check your balance or get money out.

These fees are “direct charged” by the bank or company that owns the ATM. You’ll see the amount onscreen and have the option to cancel your selection rather than pay the fee and continue.

Download the NAB app for your smartphone and use it to locate NAB or rediATMs near to you when you’re out and about; it could save you a lot in fees.

Things we don’t charge fees for

Unlike some banks, we don’t charge fees for:

  • going over your credit limit (but we do have the right to decline the purchase)
  • replacing lost or stolen cards
  • producing transaction evidence (which is part of the process if you dispute a transaction)

Credit card surcharges

This isn’t a fee from your credit card provider. Some businesses both locally and overseas will charge you a ‘surcharge’ for using a credit card. It’s usually a percentage of the purchase you’re making and these fees can add up, so it pays to be aware of this when you’re shopping.

Interest is another story, though, so it’s a good idea to read about avoiding credit card interest.

Did you find this article helpful?

If you have some useful tips on avoiding fees to share, or if there’s anything else you’d like to know, leave us a comment below.

For more information:

American Express is a registered trademark of American Express Company.
MasterCard® and the MasterCard® Brand Mark are registered trademarks of MasterCard® International Incorporated.

Tags: Credit cards

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Comments

8 Responses to Credit card fees and how to (mostly) avoid them

  1. daniel says:

    I need to link the international transaction fee with the actual transaction in my statement so that I can claim it for work purposes. But in the statements, they seem randomly organised and so I’m unable to link them. Am i missing something or is this an area of improvement for the NAB?

    • NAB says:

      Hi Daniel, thanks for the feedback – I’ll pass this onto the Credit Cards team. The separation of fees is intended to be more transparent- however, these fees can be seem randomly organised at times and it’s an area of improvement for us. If you have any transaction queries in the meantime, don’t hesitate to email us at social.media@nab.com.au ^JL

  2. deb says:

    Do you have any accounts that don’t charge international fees? We took out a visa debit account 4 years ago to travel & it worked brilliantly but now that seems to have changed & I can’t see anything similar.

    • NAB says:

      Hi Deb, if you have a Gold Banking account, you can still make international transactions with no fees until 10th August, 2012, after which these fees will apply. Our traveller card offers no NAB ATM or point of sale fees when you travel. More info here. ^JL

  3. Nic says:

    Can I use my Platinum One Visa Card like a visa debit card by transferring my own funds into the account and operating it in the black?. Will this still incur cash advance fees if I withdrawn my own funds at atm or eftpos?.

  4. A. M. says:

    If I don’t purchase “Lost Card Cover” and my card is lost or stolen, do I need to pay to cancel the card?
    Also, if I notify NAB within 48 hours of theft or loss, what happens if someone else uses it within that time? Would I be required to pay back those funds?

  5. Jason says:

    Are there any fees associated with paying your credit card balance using direct debit?

    • NAB says:

      Hi Jason, paying your credit card by cash deposit, cheque, internet banking funds transfer or direct debit, do not attract any fee’s from us ^SM

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