The Danger of Banking Abroad

By: Ira Allen

Heading abroad? Watch outabroad can be dangerous! Thats how your bank feels, at any rate. For U.S.-based banks, capping ATM and teller withdrawals, as well as point-of-sale purchases, is standard practice regardless of where you are. But banks take that practice to a whole nother (potentially criminally liable) level as soon as you leave home, and especially if you travel abroad.

An example from my personal life (and no, Im not going to say who I bank with): When Im in the States, Im not actually sure what my daily withdrawal limit from an ATM isthough Ive had to take out large chunks of cash once in a while, nearly wiping myself out (to buy a car, for example), Ive never hit that magic number, I guess. I can tell you pretty definitively what my limit is when Im not in the States, though. Its $300 per day.

Now, dont get me wrong, please; $300 is a fair bit of money. But its not exactly all that much, in certain circumstances. For instance, when my computer died the other day, I (looking to get the best deal) went to a locally owned store instead of a massive electronics-mart. Here in France, though, small businesses often taken only a special kind of bank card: the carte bleue. If you havent got one, then cash is your only option. (They do this, by the way, to avoid being hit by the massive fees that credit card companies charge them per transaction, fees that allow the credit companies to offer you points and miles. Just remember, the next time you earn miles on your card, chances are youre screwing a small business owner. But thats another article . . .)

So, off I went to the ATM. And then to the next ATM. And the next, and the next. What was going on? Why couldnt I take out my money? After taking out about 200 Euros (at the current exchange rate, just shy of 300 USD) from the first ATM, I wasnt able to get anything more at that or any others. Imagine my frustration!

Now, if this were where the story ends, wed really all have to agree that my unhappiness was pretty much my own fault. After all, everyone knows that banks put limits on ATM withdrawals. They have to, to protect themselves in the event that your card gets stolen and someone runs around taking out all your money (this wasnt a credit card, mind youjust my normal bank card). If they didnt, since theyre responsible for that money, theyd go out of business in short order!

Like I said, if this were where the story ended, there wouldnt be much of a story in it. But its not. I called my bank and spoke for a while with a friendly representative who genuinely wanted to help but couldnt. That is to say, she simply could not allow me access to more than 300 dollars of my moneynot just from one ATM at one time, but from all ATM transactions combined throughout the course of a day. Yes, she was sorry, but she could not allow me any more access. The fact that I was up against a deadline and in desperate need of a computer that, at that point in the evening, I could only buy at a store that only accepted cash? Well, it aroused her sympathy, but didnt change things any. Eventually, I had the chance to speak with her supervisor. After a pleasant but frustrating discussion, in which I suggested that (though Im not personally into that whole scene) the banks policy of not changing this limit was absolutely ripe for a lawsuit, this bank representative softened a little.

Yes, she could raise my withdrawal limitbut only up to 500 dollars. That is to say, again, I could only take out 500 U.S. dollars of the money that I had worked for and entrusted to my bank for safekeeping. It didnt matter that it was my money and not credit. It didnt matter that I had been on the phone for over half an hour (a fair portion of the time on my own dime, calling the U.S. from a cell phone in France). And it didnt matter that not being able to buy the computer that night would quite literally prevent me from practicing my livelihood, and could actually damage my earning power (because if you dont accomplish certain freelance contracts on time, people stop wanting to hire you). The bank had a policy: no more than 500 USD per day for total foreign ATM withdrawals. No matter what.

So, why am I telling you this? Just to vent? Well, surethat too. But, mainly, Im telling you this in case you should find yourself heading to that dangerous place, abroad. If you do, beware and take good care. The most dangerous thing about "abroad" may be your own bank.