Late last year, I received a notice from Visa informing that I was eligible to receive funds from their foreign transaction fee settlement. MasterCard and Diner’s Club were also part of the settlement. If you haven’t applied, or don’t know about it, here’s what you need to know.
Foreign Transaction Fee Lawsuit Background
The suit argues that Visa, MasterCard, and Diner’s Club (together with several issuing banks) colluded to set and conceal foreign transaction fees on credit card purchases. It also argues that they inflated the exchange rate on those transactions. The suit applies to the period between February 1, 1996 and November 1, 2006.
Although they deny wrongdoing, the banks and issuers have agreed to a settlement, which means you’re entitled to receive settlement funds if you used an eligible credit card in a foreign country during that period.
How to Apply for Settlement Funds
The application process is very simple. Just go to the Credit Card Conversion Fee Settlement website, and click the “Submit Your Claim” button. If you have your refund ID, enter it there. If not, click the tiny “I do not have a Refund ID” link to continue.
You have three settlement options:
Refund Option 1: An Easy Refund of $25. This is best for people with less than one week of travel, or total transactions of less than $2,500 between 1996 and 2006.
Refund Option 2: A Total Estimation Refund. This is based on your typical spending habits during travel. Use this if you traveled for more than a week, or spent more than $2500, but don’t have complete records to back up your claim. The refund will be a maximum of 1% of your estimated foreign transactions.
Refund Option 3: An Annual Estimated Refund. If you have records and traveled extensively, or used a company card, then use this option. You have to provide a year-by-year spending estimate, but your refund will be a maximum of 1% to 3% of foreign transactions.
My husband and I only had one trip during that period. We checked our records and found that our charges were less than $2500, so we opted for the simple $25 reimbursement. My parents travel extensively, and have their documentation, so they used option three. My sister lived abroad for a few months, so she also used option 3.
If you think you’re eligible, apply now. It’s free money and applying doesn’t take a lot of effort. The deadline to apply is May 30, 2008.