Buying in dollars - credit card or dollar bank account

RomfordNavy

At the moment we are purchasing in dollars using a number of UK credit cards and paying the associated charges.  I am wondering if there might not be a better way by opening a dollar acount and paying with a dollar denominated credit card, if such a thing is available to businesses in the UK?  Can a UKperson/business have a $ credit card.

Been trying to compare Fx rates between credit cards but can't seem to find any rates published so making multiple purchases with different cards and comparing rates seems to be the only way to compare.

HillStreetBlues

RomfordNavy said:

At the moment we are purchasing in dollars using a number of UK credit cards and paying the associated charges.  I am wondering if there might not be a better way by opening a dollar acount and paying with a dollar denominated credit card, if such a thing is available to businesses in the UK?  Can a UKperson/business have a $ credit card.

Been trying to compare Fx rates between credit cards but can't seem to find any rates published so making multiple purchases with different cards and comparing rates seems to be the only way to compare.

What charges? are you using a fee free cards?

grumpy_codger

RomfordNavy said:

Can a UKperson/business have a $ credit card.

First of all, does it have to be credit?

Secondly, there are many credit and debit cards for personal use that don't charge any fees for purchases in foreign currencies.

MSE: Travel credit* cards

* I have no idea why they stubbornly keep this misleading title as two out of their three "top pick travel cards" are in fact debit cards and all "top alternative cards" are debit too.

However if they like credit cards more they should have mentioned Halifax Clarity. Also, HSBC Global Money account  must be mentioned.

Not sure about businesses, but a quick google search results in https://www.finder.com/uk/business-credit-cards/business-credit-cards-no-foreign-transaction-fees

Olenna

It depends what you want and require:

You could use a commercial credit card like Capital on Tap that is forex free.
The card's USD/GBP rate is set by card scheme (in this case Visa with a 0% loading fee).

A Wise business account can offer a GBP and USD account that you can use with their debit card. 

RomfordNavy

It was my understanding that most UK credit cards charge something like a 2.75% Non-Sterling Transaction Fee and also their Fx rates are quite a bit worse that the preveiling inter-bank rates.

HillStreetBlues

RomfordNavy said:

It was my understanding that most UK credit cards charge something like a 2.75% Non-Sterling Transaction Fee and also their Fx rates are quite a bit worse that the preveiling inter-bank rates.

Most do, but there are fee free ones https://www.moneysavingexpert.com/credit-cards/travel-credit-cards/

grumpy_codger

HillStreetBlues said:

RomfordNavy said:

It was my understanding that most UK credit cards charge something like a 2.75% Non-Sterling Transaction Fee and also their Fx rates are quite a bit worse that the preveiling inter-bank rates.

Most do, but there are fee free ones https://www.moneysavingexpert.com/credit-cards/travel-credit-cards/

Like I said above, you'll be surprised to find out that there is only ONE credit card mentioned in the article.

No Clarity, no Santander Edge, no Zopa, no Natwest, no RBS, no Virgin Money, no ....

zagfles

RomfordNavy said:

It was my understanding that most UK credit cards charge something like a 2.75% Non-Sterling Transaction Fee and also their Fx rates are quite a bit worse that the preveiling inter-bank rates.

Your first understanding is correct, but that's not a problem. Most charge, but some don't, so use the cards which don't, there are plenty. Eg Halifax Clarity, Barclaycard Rewards, Nationwide member credit card, First Direct debit card and several others. 

Your second understanding is wrong. The current USD VISA rate is 1.2372 and Mastercard is 1.2363 which are both a whisker off current interbank rate 1.2378. 

lr1277

When you say open a dollar account, do you mean a dollar account in the UK or in the US? There was a dollar denominated Amex card but I don't know if it is still available. Also I think you had to pay it off from a dollar denominated current account.

If you can pay for stuff by card, you can use a fee-free debit card possibly or a fee-free credit card possibly.

You mentioned buying stuff for your business. Whilst I have never used them, the 2 suggestions made by @Olenna look like they are worth investigating and might be suitable.

If you can buy stuff with a personal debit or credit card, you should be able to find one that allows fx-fee free transactions.

PRAISETHESUN

If you need to actually keep some reserve USD, then I'd suggest a multi-currency account like the ones offered by Wise or HSBC Global money. They offer very good exchange rates, minimal fees, and overall good value.

If it's just to transact in USD but ultimately paying the bill in GBP, then as above there are a few good credit/debit card options in the pages linked above. Minimal/no fees and good exchange rates. Barclaycard Reward and Halifax Clarity cards are the usual credit card winners, or Chase bank as a debit card alternative.

RomfordNavy

Thanks for all the comments.  Looks like I will be best to forget about dollar bank account and just search for a forex fee free credit card.