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What Is A Non-Sterling Transaction Fee?

Stephen Hart

Stephen Hart

Founder - Cardswitcher

Former - Chief Financial Officer @ Worldpay

If you frequently travel abroad, you’ve likely encountered unexpected charges on top of what you paid overseas.

When you make a payment to a business outside of the UK, you’ll often be hit with a ‘Non-Sterling transaction fee’ for paying in another currency.

In this quick guide to Non-Sterling transaction fees, we explain exactly what they are, why they’re charged, and how you can avoid them.

What are transaction fees for foreign payments?

A foreign transaction fee, or FX fee, is essentially a charge for having made a card payment in a foreign currency. When you make a payment by card whilst travelling abroad, you’re typically charged a percentage of each transaction you make.

Depending on who your card is with, this charge may be made up through a fee from both the payment processor and the card issuer, and often works out at around 3%.

paying by card at pool

Why are Non-Sterling fees charged?

It may be frustrating if you only discovered you’d be charged for using your card abroad, after you were charged. However foreign transaction fees are applicable to almost all transactions either abroad or from a foreign company. The fee is said to be charged in order to cover the efforts of the issuing bank for having converted the money.

Whilst the 3% fee might seem marginal in the grand scheme of things, it can start to add up. Particularly for travellers on a budget, foreign transactions fees can be an unexpected and unpleasant additional cost. So, what are they charged for?

Paying overseas by credit or debit card

Unless you’ve used a FX free travel card, you’ll be charged a foreign transaction fee on each purchase you make using your debit or credit card.

Buying goods online from abroad

Even if you haven’t gone away, you could still find this fee on your bank statement. FX fees can apply when purchasing goods online that are located outside of the UK.

If you notice a charge listed on your statement as “NON-STG PURCH FEE” or “NON STG TRANS FEE”, there’s no need to panic. There probably isn’t anything wrong with your online payment security. It’s very likely that you’ve just bought from a company abroad without realising, and your transaction has been subject to the FX fee.

Buying digital products

It would be easy to think otherwise, but FX fees can even apply when purchasing digital products. Whether you’re purchasing online games or running a business that uses services from a foreign company, you’re likely to be subject to Non-Sterling purchase charges.

looking at statement with Non-Sterling transaction fees

How to avoid foreign transaction fees

Nobody likes to pay extra, particularly if you’re on holiday or trying to save costs when running a business. So, what are the best ways to avoid foreign transaction fees?

Using a charge free card

Debit and credit card fees that don’t charge foreign transaction fees are the simplest way to get around paying extra. These have risen fairly substantially in popularity, and you can choose between cards from companies like TransferWise, Monzo, and more. Alternatively, you can enquire with your existing bank whether they have a FX free travel card.

Using cash

If you’re using cash then there’s no need to worry about any additional costs appearing. However, some fees may still apply if you choose to withdraw money from an ATM abroad. You could be charged a rate for using the ATM or a conversion fee, and you might get a poor exchange rate.

Paying in the local currency

If you’re paying by card in a shop or restaurant, you may be asked whether you want to pay in pounds or local currency. Though it might feel safer to opt for pounds, this means the retailer or business carries out the currency conversion. You'll often then be left paying a poorer rate than expected.

When you’re using an overseas travel card, or FX free card, it’s always best to pay in the local currency. This way your card will do the exchange for you.

Be wary of debit card spending fees

On top of the Non-Sterling transaction fee, some debit cards charge you a fee just for spending abroad. These usually vary between £0.50-£1.50, and can result in significant extra costs if you’re frequently making purchases. If you’re planning to use your debit card abroad, ask your bank what fees you’ll be charged.


If you’re planning a trip abroad, it’s always best to be prepared and have a plan of how you want to spend. Do your research and find out your bank’s foreign transaction fees, or apply for a travel card to avoid the hassle.

When buying products for yourself or your company, it’s worth looking into any products you’re purchasing. If the company is located overseas, you should be aware you may pay foreign currency fees.

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Written by:
Stephen Hart

Stephen Hart

Founder - Cardswitcher

Former - Chief Financial Officer @ Worldpay

Stephen brings a wealth of experience honed through years in the financial sector, particularly in the card processing payments industry. His illustrious career spans key roles at PwC, Natwest, and the role of CFO at WorldPay, before going on to found card processing comparison site, CardSwitcher. He is passionate about helping growing businesses to understand the card processing landscape so they can make savvy financial decisions.