Assessing the overseas value of credit cards
Among 11 credit cards surveyed by the JoongAng Ilbo, Crossmile from Korea Exchange Bank has the biggest flight mileage benefit. For each 1,500 won ($1.44) spent using the credit card, 1.8 crossmiles are accumulated.
A crossmile is the equivalent of one mile on flights by Korean Air, Delta Air Lines, Thai Airways, Malaysia Airlines, China Southern Airlines and Cathay Pacific. For Asiana, a crossmile is the equivalent of 1.2 miles. Users need to spend 833 won to receive a mile on Korean Air and 694 won for Asiana. Other credit cards typically require spending 1,000 won to 1,500 won to earn a flight mile. The annual membership fee for the Crossmile credit card is 20,000 won, and miles expire after five years.
A close competitor is Citibank’s Megamile Card, which gives users 0.7 miles for Korean Air when spending 1,500 won and 1 mile for Asiana. However, it offers “special” flight miles for purchases at restaurants, duty-free shops, gas stations and department stores that have contracts with the Citibank. For each 1,500 won spent, five to 20 miles are awarded. However, the maximum is 3,000 miles per month and the holder must have charged 300,000 won the previous month.
This credit card is good for those who spend more than 1 million won a month at gas stations and department stores and can yield 40,000 miles a year. The annual membership fee is 10,000 won.
Some cards turned out to be more beneficial when used overseas. Usually an international card fee of 1 percent is assessed on purchases and an additional fee of 0.18 to 0.35 percent goes to the card issuer.
Because of these charges, many tourists are reluctant to use their credit cards abroad. But when the won appreciates against the U.S. greenback, it can be better to use cards. Usually it takes as long as four days before the charges are posted with the issuer, allowing additional time to benefit from won appreciation.
BC Global Card waives the 1 percent international card fee because the company doesn’t use Visa or MasterCard’s international payment service network in favor of alliances with Discover Card or UnionPay of China. The annual membership fee is only 2,000 won. However, the BC card does not enjoy wide acceptance, like Visa and MasterCard.
Hana SK Smart DC Card, whose membership fee is 7,000 won, offers a 0.7 percent discount at partner domestic and foreign stores.
Shinhan’s High Point offers a maximum point rate of 5 percent of purchases. Points can be withdrawn as cash or used to pay bills for mobile phones and utilities.
Samsung Card 3 offers a maximum 2 percent point accumulation on travel-related purchases. Additionally, it offers points equal to 5 percent of purchases at duty-free shops. The annual membership fee is 20,000 won.
The best card for withdrawing cash overseas turned out to be Hana SK’s Viva 2 Platinum, which can be used at any ATM displaying a VISA or PLUS logo. There is a 1 percent fee for cash withdrawals. However, when the amount exceeds $100, it is better to use Citi’s International Cash Card, which charges 0.2 percent at ATM machines with Citi logos. Neither card has a membership fee.
Anyone who has Hyundai Card’s T3 Edition with an annual fee of 70,000 won, KEB’s Crossmile Special edition (100,000 won), Woori’s Blue Diamond (120,000 won), Citi’s Premiere Miles (120,000 won) and Shinhan’s The Classic Card (100,000 won) gets a priority pass that allows access to 600 airport lounges. These credit cards are popular among customers who go on frequent business trips or newlyweds.
Users of Woori’s Blue Diamond and Citi’s Premiere Miles cards receive a companion round-trip ticket at no additional charge for each domestic round-trip ticket purchased.
KB Kookmin’s ROVL card, whose annual membership fee is 300,000 won, offers a companion roundtrip ticket to Southeast Asia and seat upgrades.
BY AHN JI-HYUN [email@example.com]