Two important warnings for Americans using their credit cards in Europe

You probably already know about foreign exchange fees. But did you know your credit card may not work overseas at all?

Two recent visitors to Europe have returned with cautionary tales that are worth passing along to you, particularly if you’re about to go on vacation. The first comes by way of reader Doug Carlson, who points out that many European merchants require a credit-card PIN number to complete a transaction.

A friend had tipped Carlson off to the fact, so he enabled a PIN on his credit card before he left. He’s glad he did.

During my trip, an airline in Belarus, a restaurant in Sweden, and a railway ticket vending machine in Denmark required me to enter my PIN on a keypad.

No American bank has ever informed me that I might need to use my credit-card PIN to purchase goods or services from a merchant. When I returned home, I called Chase, Capital One, Citibank, and Bank of America. Each bank’s customer-service representative was unaware of this practice!

Carlson says American banks are failing their customers by not advising them to obtain a PIN for their credit cards before traveling abroad. I agree.

Warning number two is about chip-enabled cards. Many European merchants don’t accept cards that aren’t chip-enabled, as reader Christopher Jenkins discovered on a recent trip to Britain.

Chip-enabled cards seem to have spread everywhere and we are having a hard time using our US bank-issued credit cards since they aren’t chip enabled. We keep on having to go to cash machines which fortunately don’t seem to be affected — yet.

I’m no expert on payment systems, but my advice is to do a credit card “check” before taking off on any overseas trip, and particularly if you’re headed to Europe. Seems even the American banks are clueless when it comes to Euro card technology and requirements.

Don’t make the same mistake.

Update (6/9/09): A Capital One representative has pointed out that your card should still work in Europe, even if you don’t have a PIN number. She points to the following language on the Visa site:

Ensure your card is processed successfully when traveling abroad
Traveling to Europe soon? Be aware that many countries throughout Europe, including the UK, Ireland, France, and others, have recently introduced a chip and pin payment system that utilizes cards embedded with a chip and protected through the use of a personal identification number. Some merchants in Europe have mistakenly refused to accept Visa cards issued by U.S. financial institutions because the cards do not have an embedded chip that can be read at the point of sale.

The good news is that U.S. cardholders visiting Europe can continue to use their magnetic stripe Visa card in countries with this system. The merchants’ terminals are designed to recognize and prompt appropriately, and you should still be able to sign a transaction receipt.

  • Fred Marconi

    Cuts both ways. I can never buy petrol at the pump in the US with a European card because they want me to enter my zip code…

  • Jasper

    This is due to new ‘ID safety’ regulations in the EU. Within a certain time, all EU credit card payments will be PIN-only and chip-only. Listen closely to the EU media and you’ll hear public service announcements about it.

    Let’s see how quick the introspective US market will adapt (don’t hold your breath). Must be odd to have to adapt to foreign regulations, when the whole credit card system was invented in the US.

    BTW: There measures are to increase security of credit card payments, as well as protect the privacy of the paying customer. [Oh, and off course, it's a sneaky way to align the European markets a bit more - there are still a lot of disparities left, that hinder the free movement of people and goods.]

  • Joe Farrell

    You ALSO need to call your credit card firm and tell them where you are traveling. I have heard horror stories of cards being suspended for suspected fraud because all of a sudden you make charges overseas.

    Call them – get a pin and put the no-fraud alert on your card.

    I suspect that the companies fraud suspend because there are many many examples of cardholders returning from overseas after spending $4-5k and claiming the card was lost or stolen and the banks just don’t want to deal with their lying thieving customers so they simply suspend everyone going overseas without a call.

  • Jasper

    @ Joe: Never had a problem using my cc in Europe, except for the PIN thing then.

  • Joe Farrell

    @Jasper – depends on the company . . . Citibank is more restrictive than Chase – depends on your history.

  • Carver Farriw

    The PIN thing is new to me. I’ve been all over Europe (albeit not Sweden) and I have never been requested to enter a PIN. Also, most card readers that I have seen can accomodate both chip and non-chip credit cards. Even in small little shops.

    However, I have had to deal with the fraud alert even traveling within the US.

  • Metin

    It happened to me, Citibank suspended my credit card when I was in Europe, I called them after I returned from my trip and customer rep said “I had to inform them before I leave that I’ll be using my cc abroad”.
    Before my next trip I called and they said “they’ll inform fraud department and they will put a flag on my card”

  • Joe Farrell

    When I was in China last year, I called ahead of time to let my cc company know – they told me to make sure my pin was activated as several places need a pin. I did.

    I was in Meng Shui, a ‘small’ town [of 1 million!] about 40 miles east of Jinan, itself about 300m southeast of Beijing, and I was buying shoes and they needed a pin on the credit card – I had one and my traveling companion did not – what was strange is that I needed the pin in the middle of nowhere while in Beijing not a single place asked for a pin.

    The newer places probably have more modern technology . . .

  • Johnny

    What I have found in my European travels is that some merchants’ PIN pad terminals simply require you to acknowledge the amount of the transaction if you don’t have a PIN setup on your credit card.

  • Tanya

    Although I have lived in the USA for almost six years, I have kept my foreign credit cards and for the first few years had a hard time using my cards because of the security chip. Many US businesses have credit card machines that read this chip but unfortunately very few are aware of how to operate it until recently. I have gotten used to the hassle but my family and friends find it irritating when they visit. Luckily it’s mostly fast food restaurants now who are unaware of how to use the credit card machine. So, I guess it goes both ways – Europe and the USA need to work together on these things.

  • http://www.bonjourparis.com Karen Fawcett

    Be prepared is the name of the game when it comes to withdrawing money from foreign ATMs. Be certain you have two cards (you’re usually safer with Mastercard and Visa (many ATMs are not AmEx friendly) with 4-digit (not letters) pin numbers. They need to be issued by your home bank. Cards are part of a banking network. If one card doesn’t work at one bank, it may at another.

    When you make a withdrawal, do NOT take $50 here and there. Take more money since there’s always a transaction fee.

    Do inform your credit card company of the places you’ll be traveling and when. There is a weekly withdrawal limit. I find I rarely reach it since so many merchants accept credit cards in the EU. You can even use credit cards on the (costly) highways to pay tolls.

    One pesky thing to remember is to keep your credit cards separate from one another. They may become demagnetized. I have various ways to TRY to make them work again – but there are NO guarantees.

    When you’re out, you don’t need to carry your passport – simply a photocopy of the key pages. Leave all but one credit card in your safe and have a list of all the credit cards you have with you. Leave a copy in your hotel safe and one with someone in the US who can call (please not) and cancel them should they be stolen.

  • Erik

    Make sure you have the “regular” phone numbers of your ATM and CC companies with you. Calling an “800″ number from outside North America is tricky. Not impossible, but not always easy.

  • Matthew B

    Personally, I’ve never had an issue using a credit card in Europe without a PIN (none of my US credit cards have PINs). That being said, I’m usually traveling on business so tend to be using a card in higher end hotels and restaurants.

    When using an Australian issued card here, if the gas pump wants a zip code I put in 00001 and that works.

  • Graham Harrison

    I have had problems buying petrol in US gas stations because I don’t have a US mailing address and a zip code. It means I have to go inside get the machine turned out, go out, gas up, go in, pay, go back to car.

    As for PIN numbers I’ve used them in all sorts of countries, not just Europe. In Canada a couple of years ago I had to teach a retailer how to use their terminal to deal with my chip and Pin enabled card.

    Telling your bank you’re going abroad doesn’t always stop problems. I’ve had 2 occasions when I’ve had to call home despite telling my bank where and when I will be travelling because they stopped the card. Personally, I see it as an irritant because I’d rather know my bank is looking out for me than just allowing anything to happen.

    Now, PIN in Europe. I can only talk with any authority about the UK because that is where I live. An acquaintance runs a shop in the UK. When CHIP/PIN became “mandatory” he was very careful to tell me next time I bought from him I would have to know my PIN. I pointed out to him that there are still cards with no embedded CHIP. I asked him how he was going to sell to people from abroad who didn’t have a CHIP/PIN card. He looked a bit nonplussed so I suggested he phone his bank and ask. Next time I saw him he thanked me because he had discovered that despite all the propaganda about CHIP/PIN being mandatory it wasn’t true. The bank told him that there are such things as CHIP/Signature cards (something to do with some disabilities) and yes, cards without a CHIP or a disabled CHIP were still acceptable by the old swipe/sign method. I’ve learned when abroad that sometimes you need to get the retailer to phone their authorisation centre to overcome issues such as this. If they want your business, they’ll do it. If not, do you want to do business with them?

  • Nancy Miller

    I just got a new card from Citibank – I’d asked them in May if they were going to include a chip on this one – nope!

  • Jeanne

    Thanks for the info. I just called my bank and got them to issue a PIN on my credit card, while at the same time informing them of my travel dates and countries for my trip to Europe in the fall. Since my card is due to be re-issued prior to my trip, I did ask if it was going to be chip-enabled. I don’t have a “big name” bank, so I wasn’t holding my breath when I asked them. The answer was of course no.

    Any hints on what to do if I do run across a merchant in Europe that requires a chip on my card? I’m traveling to Paris, Burgundy, Switzerland, Austria, Venice, Florence and Rome.

    Thanks.

  • merchant

    simple: shell out cash, or keep moving.

  • http://www.HowToTravelTips.com Ken

    Visa, MasterCard, and Amex all say that ANY retailer that accepts their cards must accept swipe-and-sign transactions. Have any reluctant merchant call their card authorization center.

  • Debra

    Calling before a trip to Europe? My husband and I had our AMEX card suspended when we ventured out of state (from CO to Nebraska). I called them in-route to find out what the problem was and they assured me that they had not suspended my card – but made a record that I was travelling in multiple states for the holiday weekend. We continued trying to use it but finally gave up. When I got home, I had two phone calles from AMEX, so I finally called them back. They told me my card was suspended because we stopped in multiple states for gas (the motorcycles have to have gas every 100 miles). They suggested I let them know next time about my travel plans. In the future, I’ll either use case – or rotate my purchases among different cards. Apparently, buying fuel frequently sets off the fraud alerts and causes your card to be suspended.

  • Lisa

    My husband and I just returned from Germany and Austria and I was also in England for a week a few months ago. I was aware of the “chip” issue. However, I had no trouble using my cards abroad. At retailers and restaurants, the counter clerk or server will swipe your card and then you will sign the credit card slip. In train stations, or subway stations, some machines may not accept your card. If there is an attendant on duty, then the attendant is able to swipe your card and allow you to sign the credit card slip. And, for those stations without an attendant, as a previous commenter said, always carry a little backup cash, or be prepared to pop up out of the station to find an ATM. Lastly, it can really pay to take out a good amount of cash upon arrival and keep it in a hidden money belt on your person, as credit card convenience fees for converting Euros to Dollars can cost you at least 3% of the purchase price of an item or meal. Research your daily bank limits for withdrawing cash and any fees your bank may charge before you leave.

  • Steve

    Chris, Great story.

    I always contact my credit card companies, as well as my bank, each time I travel abroad to let them know where I’ll be and when.

    I learned my lesson the hard way when my ATM card didn’t work and my credit card was turned down. It wasn’t because of insufficient funds or lack of payment. It was because they were a little overzealous in their attempts to “protect” me, even though if they’d checked my previous travel patterns, they would have seen I had been to these places before.

  • terry

    when traveling to ireland last year, i informed capital one of my travel dates. the rep was helpful in letting me know that a pin # starting with “0″ may not work. my husband tested this out & it turned out to be true.

  • dave

    It’s all well and good to say you will need to convince the merchant to call the card authorisation centre; this works nicely in England. However, when you’re travelling in Poland — or Albania — or Slovenija, where there are likely big language barriers, this is not always possible.

    I have never been forced to enter a PIN, but I have had to have arguments with merchants in rural areas — this was specifically a problem in Switzerland — about the fact that chip-and-PIN is NOT standard in America and that I could not get a chipped card even if I begged for it.

    It is worth mentioning that you should ALWAYS have cash on you. There have been many times where I tried to use my US-based cards in Europe (either credit, or ATM) only to find that the communications between the EU banking system and the US authorisation system was down (usually at the weekend, too) and I couldn’t use my cards. This caused us massive heartburn in Barcelona, where the communications failures lasted through a bank holiday and we ended up down to our last E0,80 in cash.

  • Carolyn

    I am on the phone with Bank of America as I write this and they have no clue about the chip-enabled cards. American Express was extremely rude to me on the phone just now about the situation. When I tried to explain that yes, I understood I could use my Amex overseas, but that I still might need the chip, the representative said “but you can use your card in England”. !!!! I asked to be transferred to a manager and the man hung up on me. I’ve never had such terrible customer service from American Express. They’ve always had the bar raised higher than all the others.

    This PIN number and chip-enabled card issue has them completely confused. When are we going to catch up with the rest of the world!?

  • Jennifer Hanuschak

    My sister was in England two years ago, and ran into this chip issue with her credit card. All of the merchants were kind and worked to put her transactions through using a different machine. There was certainly some confusion, but no real problem, and they all learned something. She did a lot of shopping on that trip to Bristol, so everybody was happy!

  • http://www.budgetnomad.blogspot.com Ryan James

    I had the chip issue in a restaurant in Malaysia. We did not have enough cash to cover the check, it was late and there was no convenient ATM machine around. I insisted that they could swipe the card the old fashioned way, but they insisted their machine no longer had the swipe slot capability. I suggested they call the local Visa issuer to get approval, but they claimed they could not do that either. The end result was that they allowed us to leave without paying for the meal with our assurance we would return the next day to pay in cash. We did exactly that and they were not too surprised that we did return.

  • Nita

    I just returned from 3 weeks in Germany and France and used my Citibank cc card with no problems. However, I did not use it often as I always go to an ATM to buy euros. In the past I’ve called my cc card issuer and informed them of my travel dates and countries I’d planned to visit, but this time I did not.