How much do credit card fees cost?

Credit cards can come with a range of fees and charges. From annual fees to late payment fees to international transaction fees, the cost of having a credit card can quickly add up over time.

On the upside, you may be able to avoid paying them if you know what to look for. We’ve explained some of the most common fees you may be charged and tips to help you avoid them. We’ve also looked at how much you could be charged (where a fee is charged), based on credit cards on our database.

1. Annual fee

Some credit cards charge an annual or monthly fee. This is charged to help cover the credit card’s features (such as complimentary insurances or rewards programs). Generally, the more features a credit card has, the higher the annual fee will be. The average annual credit card fee is $152, based on credit cards on Canstar’s database.

There are some no annual fee credit cards. So if you don’t think you are getting much value from your current credit card, you could consider switching to a fewer–frills card with no annual fee. There are also some cards that charge no annual fee for a limited time as an introductory offer.

Fee: $30–$480.

2. Cash advance fee

If you withdraw money from an ATM or transfer money from your credit card, you will typically be charged a cash advance fee. This is usually a flat fee or a percentage of the cash advance amount – whichever is greater. On top of this, you’ll usually be charged interest on the cash advance amount. The average cash advance flat fee for credit cards on Canstar’s database is $3.50.

The best way to avoid cash advance fees is to avoid cash advances altogether. But if this isn’t realistic, you can minimise the interest you are charged (and potentially the cash advance fee) by limiting the amount of money you withdraw. You’ll be charged interest from the date of the cash advance, so paying it back quickly can also help reduce costs.

Fee: $1.50–$5 as a flat fee or 2–3.50% of the transaction; whichever is greater.

3. Late payment fee

If you don’t make your minimum credit card repayment on time, you will be charged a late payment fee. To avoid late payment fees, consider setting up payment reminders or a direct debit of your minimum repayment through your credit card provider. The minimum repayment amount is typically around $25 or 2% of the amount owing, whichever is greater.

Note that if you only pay the minimum amount, you will avoid paying a fee but you will generally still be charged interest on your outstanding balance. The average late payment fee for credit cards on Canstar’s database is $21.

Fee: $5–$40.

4. International transaction fee

If you buy something overseas, you may be charged an international transaction fee or a currency conversion fee. This could be if you make a purchase while travelling overseas or shopping online.

There are some cards that don’t charge international fees. So if you regularly make international purchases, you could consider switching to one of these cards. If you are travelling overseas, you might want to check out our Travel Credit and Debit Card Star Ratings, or consider a travel money card.

Fee: 2–3.65%.

5. Balance transfer fee

If you decide to move some or all of your credit card balance to a new credit card, you may be charged a balance transfer fee. This is a one-off fee and it is usually a percentage of the amount you transfer.

It is typically added to your credit card balance. If you have a 0% balance transfer offer, that means you may be charged interest on it when this offer period ends.

Fee: 1–3%.

6. Additional cardholder fee

If you add an additional cardholder to your credit card, you may be charged a fee. The additional cardholder can get the benefits of your credit card without opening up a separate account, such as the ability to make purchases and accumulate reward points (if applicable). At the time of writing, the average additional cardholder fee on Canstar’s database is $38.

Some credit card providers allow you to add one additional cardholder for free, so it’s worth checking this.

Fee: $10–$68.

Source: www.canstar.com – 16/01/2024. Based on personal credit cards on Cantar’s database, excluding interest-free cards. Minimum, average and maximum fees based on cards that charge a fee. Cash advance fees based on withdrawing money from a participating institution ATM.