Wondering which card is better for overseas use - Trust card vs YouTrip? We compared the fees and exchange rates and also included an alternative option Wise
The American Express True Cashback Card offers all the perks of an American Express but with cashback on purchases. But it can feel too good to be true. There are high fees for just holding the card. And despite the incentives to spend abroad, there are high transaction fees and unattractive exchange rates in-store when you do. Let’s take a deeper dive into this card, and see if it is a good fit for you.
|If you want to save on overseas spending, get a transparent exchange rate and no annual fees, take a look at the Wise multi-currency card|
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The American Express True Cashback Card works like a normal credit card. Once you apply and get approved, American Express will extend you a credit line. The card lets you spend anywhere in the world where American Express is accepted. You can shop online with this credit card as well.
Then every statement cycle you are sent a bill with the amount you have spent. If you aren’t able to pay it back in full, you will receive an interest charge on the remaining balance. But that’s just the start of charges and fees with this credit card. Here is a look at the standard charges, and how they compare to Wise’s own multi-currency account. As you can see, one of the cards makes it a lot cheaper to spend overseas.
|American Express True Cashback Card¹||Wise borderless card|
|Annual fee||S$ 171.20||None|
|Annual interest rate||26.9%||None|
|Overseas exchange rate||Set by American Express||Transparent mid-market exchange rate|
|Late payment fee||S$ 90||None|
|Minimum monthly repayment||S$ 50 or 3%, whichever is higher||None|
|Foreign currency transaction fee||2.95% (starting March 1 2020)||None|
|Cash advance transaction fee||5%||None|
Singapore citizens, PRs and Foreigners are all eligible to apply for the American Express True Cashback Card. In all cases, the principal cardholder must be at least 21 years old. But for Singapore citizens and PRs the income requirement is S$ 30,000 annually. It is S$ 60,000 annually for foreigners.²
To apply, you can head to the American Express website to fill out an application online. You will need to provide copies of approved identification, as well as income, employment and address proof. If you have signed up for MyInfo, you can apply seamlessly using your pre-populated information.
With the American Express True Cashback Card, you can shop, spend and travel wherever the card is accepted. But as with most credit cards, the more you spend using the card, the more you get back. And true to its name, this card rewards you with cashback on purchases. Let’s take a look at how it works and other perks this card offers.
The biggest benefit this card offers is around cashback on your spending. First, you receive a welcome bonus of 3% your first 6 months of having the card, up to a total of S$ 5,000 of spending. Then after that, you get 1.5% cashback on any and all eligible purchases. There is no minimum spend or cap. And if you make any purchases in a foreign currency, you will receive an additional 1% cashback.³
If you charge your full travel fare on your American Express True Cashback Card, you will get free travel insurance for your journey, up to S$ 350,000. If you are traveling as the principal cardholder, the insurance will also cover your spouse and children. The coverage extends to missed connection flights, baggage delays, and even baggage loss.⁴
With this card, you get to access all the perks of holding an American Express card. This includes 24/7 customer care, fraud protection, and Global Assist. Global Assist is a helpline that you can call to get information on everything from local doctors or lawyers where you are to help with missing baggage. You also get access to American Express Selects which is a program that gives discounts and exclusive privileges to specific restaurants globally.⁵
It would make sense to think that a card that gives you cashback for overseas spending and global perks would make it cheaper for you to travel. But underneath the attractive offers are actually high fees and weak exchange rates that end up costing you more than you think.
First, there is a high transaction fee of 2.9% on every purchase you make overseas with the card. Irrespective of what you buy or how much you spend, you will always get hit with this fee.
Second, American Express converts your foreign transactions into US dollars, and then from US dollars to Singapore dollars. That means you are getting hit by their exchange rate twice. And American Express purposefully makes the exchange rate weak so to then take a slice off the top of every conversion. It is a hidden fee to you on everything you buy abroad, and a good amount of profit for the credit card company.
Get your Wise borderless card - a multi-currency account that is on average 7 times cheaper than banks
Instead of cashback or high fees, keep real cash in your wallet with the Wise multi-currency account. With no minimum spend requirements, annual fees or foreign currency transaction fees, you can save money as you travel. Plus with the borderless card, you can hold 40+ currencies in one account to then spend locally when you travel. Need cash abroad? Wise lets you withdraw up to S$ 350 for free from global ATMs a month, anything above that amount just has a small fee.
TranfserWise uses smart technology and an award-winning app to make travel and spending easier for you. All you’ll have to pay is a small fee of .35-1% for currency conversions and that is it. On all transactions, you will be receiving the mid-market exchange rate, which is the same rate you see on Google. No hidden fees here. So that goes for online shopping you do on sites like Amazon, Qoo10 or Alibaba. Be smarter about money when you travel and keep real cash in your wallet with Wise.
Sources used for this article:
This publication is provided for general information purposes only and is not intended to cover every aspect of the topics with which it deals. It is not intended to amount to advice on which you should rely. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content in this publication. The information in this publication does not constitute legal, tax or other professional advice from Wise Payments Limited or its affiliates. Prior results do not guarantee a similar outcome. We make no representations, warranties or guarantees, whether express or implied, that the content in the publication is accurate, complete or up to date.
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