Credit card fees and how to avoid them

What makes up the cost of a credit card

A credit card rarely costs only what the advert says. The total cost is made up of fixed fees (an annual or monthly fee), usage-based charges (foreign currency, cash) and – with genuine credit cards – interest. On top of that come minor items from the price and service schedule (Preis- und Leistungsverzeichnis), which you usually only notice once they are charged.

The good news: you can avoid almost every one of these items if you choose the right card and use it correctly. The overview below shows when each item applies and what you can do about it.

Annual fee: €0 is now the norm

The annual fee is the best-known cost item, but far from the most important one. More than half of the cards in our comparison charge neither an annual nor a monthly fee (as of October 2026). They include debit cards linked to a current account, but also genuine credit cards with a credit line and travel benefits.

With “free” cards, read the small print. Some cards are only free in the first year, others only for so-called active customers (Aktivkunden) who receive a certain amount into their current account every month. If the condition no longer applies, the free card turns into a card with an ongoing fee. Account models with a monthly fee are just as common: here you are not paying for the card, but for a package of account, card and extra services.

A fee can be worthwhile if you would pay for the included benefits anyway – for example travel health insurance for trips abroad, lounge access or a rewards programme you use consistently. Do the maths honestly: which benefit would you otherwise buy separately, and how often do you actually use it?

Foreign currency fee: the underestimated cost of travelling

The bank charges the foreign currency fee (also called foreign transaction fee, Auslandseinsatzentgelt) as a percentage of every payment in a currency other than the euro. In our comparison, it ranges from 0% to just under 3%. That sounds small, but it adds up: if you spend €2,000 in US dollars on holiday, a 2% foreign currency fee costs you an extra €40 – for nothing.

What matters is the currency, not the country. Within the EU, payments in euros cost no more than domestic payments; the EU regulation on cross-border payments requires this. In countries with their own currency – such as Switzerland, the UK, Sweden, Denmark, Poland or the Czech Republic – the fee does apply, even though they are in Europe. The same goes for online purchases billed in a foreign currency, for example from shops or subscription services based outside the eurozone.

For payments in another EU currency – such as the Polish złoty, Swedish krona or Hungarian forint – card providers in the EU have also had to state their currency conversion charges as a markup on the European Central Bank's reference rate since 2020, and to inform you electronically about the costs after the payment. This makes cards easier to compare, but it does not apply to US dollars or other currencies outside the EU. That is why a card that charges no foreign currency fee at all is the more convenient choice.

Cash withdrawals: three fees that can add up

When you withdraw cash, up to three charges can combine: your bank's fee (usually a percentage, often with a minimum amount), the foreign currency fee for withdrawals in another currency, and the ATM operator's fee. The operator fee is charged by the ATM itself – it is shown to you before the cash is paid out, and many cards do not refund it, even if they advertise “free withdrawals”.

Many debit cards and neobanks work with free allowances: a certain number of withdrawals or a certain amount per month is free, after which a percentage is charged. You will find the exact allowances on each card's page in our comparison.

One trap affects credit cards with an instalment option: with some cards the withdrawal itself is free, but debit interest runs on the amount withdrawn from day one until you repay it. If you withdraw cash with a credit card, repay the amount as quickly as possible – some providers let you make an instant transfer to the card account.

Debit interest and instalments: the biggest cost block

With genuine credit cards that have an instalment option (revolving cards), the monthly statement is not automatically paid in full – only a minimum amount is. Debit interest (Sollzinsen) is charged on the rest. In our comparison, the effective annual interest rates (APR) of these cards range from around 10% to just under 26% – considerably more than for an instalment loan.

What this means in practice: an outstanding balance of €1,000 at 20% APR costs around €15 in interest in the first month. If you pay back €50 every month, it takes about two years to clear, and you pay a good €200 in interest in total. At 26%, it is already around €280.

Some cards are set to instalment repayment by default. So after receiving your card, check in online banking or the app whether full repayment is set. With full payment, you use the credit card as intended: you get an interest-free payment deferral until the direct debit date and do not pay a cent in interest. Charge cards and debit cards do not carry this risk, because the statement is always collected in full.

Minor items in the price and service schedule

Besides the big items, every price and service schedule lists charges for special cases. They rarely apply, but can get expensive at the wrong moment. Read the schedule before you apply – it is linked on the provider's website and must be made available to you before you sign the contract.

• Replacement card after loss or theft, sometimes with a surcharge for express delivery abroad
• Paper statement by post instead of an online statement
• Partner or additional card for other people
• Emergency cash or an emergency card abroad
• Returned direct debit if your current account does not cover the amount
• Inactivity fees or top-up fees for prepaid cards

Worked example: two weeks in the USA with three card profiles

A simple scenario shows how much your choice of card matters: on holiday you pay €1,500 in US dollars by card and withdraw €200 twice from an ATM. The three profiles reflect terms that actually appear in our comparison. Fees charged by local ATM operators are not included.

Checklist: how to keep your credit card free

Follow these rules and most cards will not cost you a cent:

• Choose a card with no annual or monthly fee – or only pay a fee for benefits you really use
• Know the conditions for the fee waiver (first year, active customer, minimum spend)
• Set full payment and settle the statement in full every month
• Use a card with no foreign currency fee for travel and foreign currencies
• Abroad, always pay and withdraw in the local currency
• Only withdraw cash with a credit card if no interest is charged from day one
• Choose online statements instead of paper

Frequently asked questions about credit card costs

Is a credit card with no annual fee really free?

Yes, if you use it correctly. A card with no base fee costs nothing as long as you pay in euros or without a foreign currency fee, make no paid withdrawals and settle the statement in full. Costs only arise through use – above all through instalment repayment.

Can the bank simply raise my credit card fees?

Not without telling you. The bank must announce changes to the card contract at least two months in advance. And since a 2021 ruling by Germany's Federal Court of Justice (Bundesgerichtshof), your silence is no longer enough for a price increase – the bank needs your consent. If you do not agree, it can terminate the contract.

How can I tell whether my card is set to instalment repayment?

Your monthly statement will then show a minimum amount instead of the full balance, and a remaining amount is carried over to the following month. In online banking or the app, you will usually find the setting under repayment or payment method; there you can switch to full repayment.

Is a credit card with an annual fee worth it?

Only if the value of the benefits exceeds the fee and you use them regularly – for example insurance you would otherwise take out separately, lounge access if you fly often, or a rewards programme with a high redemption value. For everyday use and occasional trips, a fee-free card is enough.