As you know Rewards Canada has been pushing for the removal of foreign exchange fees on Canadian Credit Cards since last summer. We brought the topic up as the trend emerged in the U.S. over the past two or so years and has been proven to be a very popular selling point to many travellers south of the border. Fast forward to earlier this year and we saw Chase release their new Amazon.ca Rewards Visa which was the first publicly available credit card in Canada with no foreign exchange fee. It seems a no-brainer that the Chase issued Sears cards would follow suit and they have (see our post last week). This is particularly interesting feature for the recently released Sears Voyage MasterCard which in itself is not a bad travel card, it falls somewhere in the middle of the pack of all travel cards but now suddenly it has become stronger. The only thing with it is that you are still stuck booking via Sears travel if you want to use the points earned on the card. Here is the press release announcing this change on the Sears cards:
Sears Financial says farewell to foreign currency transaction charges for over two million Canadians
Half of Canadians would swap their existing credit card for one that doesn’t charge this fee, survey reveals
TORONTO, ON – July 12, 2012
– Sears Canada’s Financial Services division, Sears Financial,
announced today that as of July 23, 2012, foreign currency transaction
charges will no longer be incurred on the Sears Financial MasterCard®
and Sears Financial Voyage™ MasterCard®. With over two million
MasterCard credit cards in the market, and hundreds of thousands of
vacations booked through Sears Travel annually, eliminating the fee is
part of Sears Canada’s renewed commitment to do more for the customer.The
foreign currency transaction charge is applied in addition to the
exchange rate when a customer uses a credit card for a transaction
outside of Canada. Most Canadian credit cards charge 2.5 percent.Half
of Canadians (51 percent) said they would consider switching to another
credit card if it meant they didn’t have to pay the foreign currency
transaction charge, revealed a recent survey commissioned by Sears
Financial, which looked at travel and spending habits.The
results also showed that 65 percent of Canadians travel abroad at least
once every two years and that the overwhelming majority (92 percent)
use their credit card to pay for meals, entertainment, and other
purchases when travelling. In fact, 61 percent always or frequently use
credit cards as their primary form of payment when travelling.A
recent Statistics Canada survey found that during the first quarter of
2012 travellers spent $8.3 billion outside the country, $5 billion spent
in the United States alone. These numbers include “snowbirds” who
travel to warmer climates, and suggest Canadians pay millions of dollars
a year to use their credit card abroad.“Many
of our customers are snowbirds. They and others will benefit
significantly from this change,” said Peter Kalen, Senior
Vice-President, Sears Financial and Home Services. “While many
travellers will continue to incur additional charges on all their
foreign purchases, over two million Sears Financial MasterCard
cardmembers will enjoy the freedom to spend without being charged 2.5
percent on foreign purchases. We also see this as a positive move for
our Sears Travel customers.”Sears
Financial made the decision to remove foreign currency transaction
charges as part of Sears Canada’s company-wide initiative to do more for
the customer. This includes recently lowering the price on over 5,000
items, an improved return policy and satisfaction guarantee, and the
re-launched ‘The Baby’s Room,’ offering new brands and more selection of
nursery and juvenile products at great prices.“Removing
this charge is another demonstration of our ongoing commitment to
provide customers and cardmembers with the quality and value they’ve
come to expect from Sears,” added Kalen.In
addition to no foreign currency transaction charge, Sears Financial
cardmembers will also earn valuable Sears Club Points everywhere
MasterCard is accepted. These points can be redeemed for almost anything
in-store and online, including a full range of flight and travel
bookings at Sears Travel. Canadians can apply for a Sears Financial
MasterCard at any Sears store.Survey Results Highlights:
· Most
Canadians (92 percent) use their credit card while travelling, with
nearly two-thirds (61 percent) using it as their primary method of
payment
- Canadians spent an average of $880 using a Canadian credit card on their last trip abroad
· Travellers
cheques are a thing of the past, with 82 percent saying they rarely or
never use them, while 64 percent rarely or never use their debit card
abroad· Transaction
fees are more important than any other consideration when choosing to
use a credit card outside of Canada; 82 percent of Canadians describe
transaction fees as very or moderately important, followed by:o Interest rates 64 percent
o Travel insurance 61 percent
o Rewards points 60 percent
· Half
of Canadians (51 percent) said they definitely or probably would switch
to another credit card if the other card does not charge a foreign
transaction feeFor more information on foreign currency transaction charges, please visit searsfinancial.ca/fx.
Now the question is will this be further extended to other Chase cards (Marriott Visa hint hint) and will other banks/credit card issuers follow suit?