Foreign Transaction Fee
A foreign transaction fee (also called an FX fee or currency conversion fee) is a charge added by your credit card issuer whenever you make a purchase in a currency other than Canadian dollars. In Canada, this fee is almost universally 2.5% of the transaction amount. The fee is applied on top of the exchange rate, meaning you pay both the conversion cost and the surcharge.
Crucially, the fee is triggered by the currency of the transaction, not your physical location. Buying from a US-based website while sitting in your living room in Toronto will still incur a foreign transaction fee if the merchant charges in USD. This catches many Canadians off guard when shopping online.
Quick Facts
| Detail | Value |
|---|---|
| Standard Canadian FX fee | 2.5% of transaction amount |
| Applies to | All purchases in non-CAD currencies |
| Online purchases | Yes — if billed in USD, EUR, GBP, etc. |
| Cards with no FX fee | Scotiabank Gold Amex, Scotiabank Passport Visa Infinite, Home Trust Preferred Visa, Desjardins Odyssey World Elite, Rogers Red World Elite Mastercard, Amex Gold Rewards Card |
| Visa/Mastercard network fee | ≈ 1% (included in the 2.5% total) |
| Exchange rate used | Visa/Mastercard wholesale rate (typically fair) |
Canadian Context
The 2.5% foreign transaction fee is standard across virtually all Canadian credit cards that charge it — compared to the US where it ranges from 1%–3%. Canadians who travel internationally frequently or shop online at US retailers can save meaningfully by holding at least one no-FX-fee card. The Scotiabank Gold American Express and Scotiabank Passport Visa Infinite are among the most recommended options because they combine no FX fee with a strong rewards programme. The Home Trust Preferred Visa is a popular no-fee, no-FX-fee option for those who want simplicity. See our best no foreign transaction fee credit cards roundup for a current comparison.
Related Glossary Terms
Information on this page is provided for general educational purposes. Card terms and fee structures change frequently — always verify details directly with the card issuer before applying.