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Explaining Mastercard Exchange Rates and Fees
2024-05-20
- This article is for reference only as it is merely a translated version of the Japanese article below.
マスターカード（Mastercard）の為替レート・手数料を解説 (Japanese version)
How are Mastercard’s exchange rates determined?
Which credit card has the lowest fees abroad?
Travelers, expatriates, and students going abroad might often wonder about these issues.
When using credit or debit cards overseas, the addition of fees and exchange rates can lead to extra costs, causing concern.
International brands like Mastercard and Visa set their own daily exchange rates for each currency, known as the “base rate,” which are not publicly disclosed.
This article explains Mastercard’s exchange rates, when they are calculated and applied, and publishes the results of a study investigating which international brands offer the best rates for each currency.
If you frequently make credit or debit card transactions abroad or want to save on fees, this information will be valuable.
What is the Mastercard Exchange Rate?
The Mastercard exchange rate refers to the “base rate” that Mastercard independently sets each day.
It is important to note that this rate differs from the market (forex) exchange rate.
| Mastercard Exchange Rate | Market (Forex) Exchange Rate |
| Includes a fee added to the market rate A single base rate is determined and applied daily | Refers to the trading rate on the foreign exchange market Continuously fluctuates with market movements |
Mastercard and Visa do not disclose the set exchange rates (base rates), and those interested must calculate them independently.
However, even without knowing the Mastercard base rate, using a currency conversion calculator can provide a good estimate of the transaction amount, so there is no issue.
What Are Mastercard’s Currency Conversion Fees?
When using a credit card abroad, the bill is paid in Japanese yen (JPY), necessitating currency exchange. A fee is incurred during this currency conversion.
The fee incurred during this conversion is known as the “currency conversion fee.”
The currency conversion fee consists of the “exchange rate fee” and the “overseas transaction fee.”
The overseas transaction fee varies depending on the combination of the credit card and the international brand, so attention is needed.
Examples of overseas transaction fees by credit card and international brand include the following:
| Credit Cards | Mastercard | Visa | JCB |
| Rakuten Card | 1.63％ | 1.63％ | 1.63％ |
| Mitsui Sumitomo Card (NL) | 2.20％ | 2.20％ | – |
| EPOS Gold | – | 1.63％ | – |
For those who wish to minimize overseas transaction fees when using a credit card abroad, it is essential to check the fees carefully before issuing the card.
When issuing a Mastercard credit card, be aware of the differences in overseas transaction fees depending on the type of card.
The same applies to using a debit card; overseas transaction fees will also be incurred.
When is the Exchange Rate for Credit Cards Calculated?
The exchange rate for Mastercard and Visa is calculated at the moment the card usage data reaches the international brand’s payment center.
This does not reflect the exchange rate at the time of shopping or dining when the credit or debit card was used.
The data reaches the payment center approximately 2 to 4 days after the card payment abroad, and it can take a few more days in some cases.
Therefore, if there is a difference between the exchange rate at the time of use and when it is calculated, a discrepancy in the amount may occur.
If you want to know the precise amount used in JPY (billing amount), it should be checked on the statement.
How to Calculate Transaction Amounts Using Mastercard Exchange Rates
To calculate transaction amounts using Mastercard exchange rates, utilize the Currency Converter Calculator.
This guide will explain how to estimate the transaction amounts and find Mastercard’s base rates using a credit or debit card.
Easily Determine Transaction Estimates with Mastercard’s Converter
When you want to know the estimate of the amount settled with a Mastercard credit or debit card, use the Currency Converter Calculator.
Here are the steps to find out the transaction amount when settled in US Dollars:
- Open the Currency Converter Calculator page.
- Select US Dollar (USD) under “From.”
- Enter the transaction amount in local currency under “Amount.”
- Choose Japanese Yen (JPY) under “To.”
- Input the overseas transaction fee under “Bank Fee.”
- Select the transaction date under “Select date of transaction.”
- The transaction amount in JPY will be displayed in red.
*Using Google Chrome’s automatic translation feature can convert the information into Japanese.
Following these steps, the calculation formula [Transaction Amount × Overseas Transaction Fee × Mastercard’s Base Rate] automatically computes, and the estimated transaction amount (billing amount) becomes evident.
*You will need to research the overseas transaction fee to input at step 5.
The reference transaction amount (billing amount) will be displayed in red as “Your transaction amount of ○○○ USD = ✕✕✕ JPY.”
As explained, the accurate transaction amount is calculated based on the exchange rate on the day the data reaches the payment center, which remains unknown to the cardholder.
Please note, this is only a method for calculating an estimated amount.
How to Find Out Mastercard’s Base Rate
Finding Mastercard’s base rate also uses the Currency Converter Calculator.
The steps are similar to those introduced in “Easily Determine Transaction Estimates with Mastercard’s Converter“:
If you enter “1,000” for the amount at step “3” and “0” for the overseas transaction fee at step “5,” and then select today’s date, you will be able to determine today’s Mastercard exchange rate (base rate).
The reference exchange rate for Mastercard will be displayed in red as “1 United States Dollar = ○○○○ Japanese JPY.”
Mastercard, Visa, JCB | Credit Card Exchange Rate Comparison 2023 Edition
Investigating Currency-Specific Findings for USD, KRW, EUR, and More
The choice of the most beneficial international credit or debit card brand varies depending on the currency involved.
This publication presents the findings of a study investigating how much currency conversion fees are added to the market rate by each international brand for different currencies.
Here are the results of the investigation:
Currency Exchange Fees (Spread) When Paying in JPY for Transactions in Foreign Currency
| Visa | Mastercard | JCB | |
| US Dollar (USD) | 0.40% | 0.30% | 0.20% |
| Euro (EUR) | 0.30% | 0.30% | 0.30% |
| South Korean Won (KRW) | 0.90% | 0.80% | -0.10% |
| Australian Dollar (AUD) | 1.00% | 1.00% | 0.20% |
| Chinese Yuan (CNY) | 0.80% | 0.80% | 1.20% |
| Thai Baht (THB) | 1.00% | 0.90% | 0.80% |
| Taiwan Dollar (TWD) | 0.30% | 0.40% | 0.80% |
| Singapore Dollar (SGD) | 1.00% | 0.90% | 0.40% |
| Vietnamese Dong (VND) | 0.40% | 0.40% | ‐ |
| Philippine Peso (PHP) | 0.30% | 0.70% | 0.40% |
| Indonesian Rupiah (IDR) | 0.60% | 0.70% | ‐ |
| New Zealand Dollar (NZD) | 0.70% | 0.70% | ‐ |
According to the results, the currencies where Mastercard offers the lowest exchange fees are:
- Euro (EUR)
- Chinese Yuan (CNY)
- Vietnamese Dong (VND)
- New Zealand Dollar (NZD)
Based on these findings, select the most cost-effective and suitable card for your needs.
Additionally, please refer to our article on recommended credit and debit cards for international travel.
- Credit card
【Recommended for International Travel】Top 7 Credit Cards | Fee & Reward Rate Comparison - Debit Card
Top 3 Recommended Debit Cards for Use Abroad | Comprehensive Explanation of Fees and Benefits
Frequently Asked Questions About Mastercard Exchange Rates
A compilation of frequently asked questions about Mastercard’s exchange rates is provided.
If you have any doubts or questions, please refer to this information.
Is there a way to check or calculate Visa’s exchange rates?
Like Mastercard, Visa’s exchange rates can be calculated using Visa’s exchange rate calculator.
For more details, please refer to “Comprehensive Explanation of Visa’s Exchange Rates | Investigating the Most Cost-Effective Credit Cards for Each Currency.”
What are the exchange rates and fees for cards like Rakuten Card and Mitsui Sumitomo Card?
The overseas transaction fees for cards such as Rakuten Card and Mitsui Sumitomo Card (NL) are as follows:
| Credit Cards | Mastercard | Visa | JCB |
| Rakuten Card | 1.63％ | 1.63％ | 1.63％ |
| Mitsui Sumitomo Card (NL) | 2.20％ | 2.20％ | – |
In addition to the above transaction fees, the base exchange rate of each international brand is added.
[Transaction Amount × Overseas Transaction Fee × International Brand Base Rate] = Amount Payable in JPY
The additional rates are set daily by each international brand and, except for JCB, are not disclosed.
Summary: Choose the Most Cost-Effective Credit Card Based on Exchange Rates from Providers Like Mastercard
This article has detailed Mastercard’s exchange rates, the timing of their calculations, and the method for computing transaction amounts. Additionally, it has shared findings on which international brands offer the best value for different currencies.
Mastercard’s exchange rate is determined daily by adding a fee to the market rate, but since it is not disclosed, it must be calculated independently.
When using a Mastercard credit or debit card abroad, the exchange rate applied is the one at the moment the transaction data reaches the payment center.
Since the most advantageous credit or debit card varies by international brand and currency, use this article to choose the best card for your needs.
For those looking to minimize fees while using cards abroad, understanding the costs involved can help you enjoy more cost-effective dining and shopping experiences.
