Here’s everything about buying in Euros with an American debit card online:
Typically speaking, you can buy something in Euros with an American debit card, whether that purchase is online or in person.
This is because debit cards are run by credit card companies, and they have systems in place to automatically convert and exchange currency as needed.
You just have to accept the charge.
So if you want to learn all about how buying online in Euros works with an American debit card, then this article is for you.
Let’s get started!
Can You Buy Something In Euros With an American Debit Card Online?
Yes. That’s the short answer.
The longer answer will involve me explaining how it all works.
Before I get into the mechanics of international transactions, it’s important to cover the variability.
Ultimately, each merchant gets to decide for themselves if they want to accept foreign currency.
So, the European online store doesn’t have to accept your American card if they don’t want to.
But, if they do accept your money, then the process will follow what I outline below.
How Does Buying in Euros With an American Debit Card Work? (3 Components)
It’s nice to know that it’s possible, but what really happens when you make such a purchase?
Is there a bunch of hidden fees?
Will it impact your taxes?
Are there things you need to know about?
In general, we can break the whole thing down into three components: conversion, exchange, and fees.
The short of it all is that you will probably pay additional fees in this process, but it’s all handled automatically, so you don’t have to worry about it.
Any regulations surrounding the transaction are baked into the automated process, and you aren’t responsible for it.
As long as you’re ok with the final price (including any extra fees), then it’s fine to make the purchase this way.
The first step in the process is price conversion.
This is describing how a price is compared in different currencies.
In this case, we’re comparing USD and Euros.
At any given moment, a dollar is worth a set number of Euros.
At the time I’m writing this, 1 dollar is currently worth 0.95 Euros (which is pretty close to an even exchange, all things considered).
This 1 to 0.95 ratio is how you figure out the price in each currency.
As an example, if your item is priced at 10 Euros then it will cost $10.53 USD.
Going in the other direction, if it costs 10 USD, then it will be 0.95 Euros.
The thing to understand about conversion is that it is referring to the theoretical rates.
Conversion does not actually turn one type of money into another type of money.
It’s the math you use to make sure everyone agrees on the price of a thing.
Actually turning one type of currency into another is called exchange.
This is really the crux of the whole thing.
If you want to buy something from a European store with an American debit card, you’re probably going to have to undergo a currency exchange.
This is when you literally trade USD into Euros.
Once that is done, you can buy the thing with your Euros, and everyone is happy.
The easiest way to understand an exchange is to consider the cash analogy.
Say you’re an American visiting Europe.
You know you need some local cash, so you go to an exchange counter on your way out of the airport.
You hand the person at the counter cash in your American dollars, and they hand you back Euros according to the conversion rate (minus a fee they charge for the service).
You physically traded USD for Euros in this case, and for the rest of your stay, you can buy things using those Euros.
When you purchase something online, this whole process still happens, but it’s all digital.
So, your USD is actually sold to an exchanger for Euros.
Those Euros are then used to pay the merchant.
Because the process is digital, it can happen more or less instantaneously, but a real exchange does take place.
When Exchanges Don’t Happen
Sometimes, there actually isn’t a currency exchange, and that’s because merchants have some options.
They can actually choose to accept USD directly if they want to.
In this case, the price is still converted according to the exchange rates, but the money itself isn’t exchanged from USD into Euros.
Merchants that go this route might choose to exchange the currencies at a later time according to their own plans.
They also might not need to exchange the money.
Some companies simultaneously work with multiple currencies, so it’s possible that they can just keep the USD in an American bank account, assuming they’re set up for that.
Let me really clarify this scenario.
If you go to a European online store and buy something that is priced in Euros with your US debit card, you still need a conversion.
You still need to know how many dollars should be subtracted from your account.
But that might not require the literal exchange of currencies, and the biggest reason that matters is that exchanges often come with fees.
Ah yes, fees.
This is why you might actually care about all of the automated processes happening behind the scenes.
First, let’s talk about conversion.
Using the term as I’ve described it here, conversion is completely free.
It’s just math, so you don’t have to pay anyone for that.
Exchanges are where the fees occur, and that’s because people are literally trading money with each other.
Businesses that specialize in exchanges make their money through fees, so it’s during the exchange that you will usually be charged any applicable fees.
A lot of credit card companies automate this part of the process too (and yes, it’s true for debit cards too).
The card company handles the exchange themselves.
So, they will charge you an exchange fee, and it’s usually a preset fee based on how much money is exchanged.
It’s all in your contract when you sign up for the card.
And, if you’re looking to find the terms with your card, this is usually labeled as a “foreign transaction fee.”
But, if the merchant does not require an exchange, it’s possible that the fee will be waived.
Basically, the merchant is eating any fee that might come up if they exchange the currency on their own terms.
Additionally, there are credit cards (and debit cards) that don’t have foreign transaction fees.
This is considered a perk of the card, so you don’t pay the exchange fees at all.
The credit card company handles it.
For what it’s worth, debit cards are less likely to waive foreign transaction fees than credit cards.
That’s because credit cards often come with annual fees and perk packages.
So if you’re not sure, you can probably assume that your debit card does charge these fees.