Wise: Beware of high ATM withdrawal fees abroad
PETALING JAYA: As millions of Malaysians plan vacations abroad this year, they should take into account one important aspect of international travel that often goes unnoticed – the hidden costs of withdrawals made through automated teller machines (ATM).
Banks and interbank networks typically impose charges for using their ATM in various destinations. A recent study by Wise revealed that Malaysians could face high ATM fees when withdrawing money overseas, which would potentially strain their travel budget and affect their overall experience.
For example, when withdrawing RM1,000 using ATM in Argentina, the fee charged is RM148 (14.8%), Chile RM63.30 (6.33%), Costa Rica RM8.00 (0.80%), the Philippines
RM28.50 (2.85%), Thailand RM26.20 (2.62%), and Singapore RM14.10 (1.41%).
Malaysians who plan to travel to Argentina lose out the most, as the country charges 14.8% on ATM fees per transaction. On average, South American countries have fees ranging from 3% to 7% based on withdrawal amounts. Meanwhile, popular destinations for Malaysians such as Australia, the Philippines, Singapore, South Korea, Thailand, and Vietnam charge between 1.15% and 2.85% per withdrawal.
On the flipside, Malaysians travelling to Japan, Taiwan and the UK can expect to be charged less than 1% when they use an ATM.
Besides ATM fees, Malaysians abroad may face hidden charges in the form of an undisclosed exchange rate markup when using traditional credit or debit cards. These hidden fees often result in many travellers spending more than they expect to.
Wise country manager for Malaysia Lim Paik Wan (pic) said, “The disparities in ATM fees abroad underscore the importance of strategic financial planning for Malaysians. Withdrawing money overseas can be convenient, but the costs vary significantly. It’s crucial for travellers to know when they’ll be hit with hidden fees and consider cost-effective alternatives while abroad.
“To stay informed, travellers may look to Wise, which emphasises transparency and fair pricing by utilising the mid-market exchange rate – the one usually reflected on Google – and details all fees for each transaction.”
Malaysians are strongly encouraged to explore digital payment alternatives to reduce dependence on ATM withdrawals. Notably, a substantial 50% of payment methods across Southeast Asia have transitioned to digital platforms.
Depending on the destination, Lim said, overseas ATM transactions can accumulate substantial costs, especially for frequent, small amounts. For example, in Argentina, a traveller who withdraws RM200 daily for a week would be paying RM29.60 per day in fees – totalling RM207.20 for the seven days.
“If you really need to withdraw money, make sure to ‘shop around’ because if there are several ATM within a short distance of each other, it may be worth comparing their rates, as fees will vary from bank to bank,” she said, adding that Malaysians travelling abroad should always pay in the local currency of the destination they’re in.
They may also use the Wise card, which facilitates seamless international spending in over 40 different currencies, and allows two free withdrawals of up to RM1,000 per month, said Lim.