STS-134

Compare:
https://www.mastercard.com/global/cu...ion/index.html
with
http://corporate.visa.com/pd/consume...r_ex_rates.jsp

For GBP, MC's exchange rates are about 0.5% better than Visa's, consistently. For JPY (I only took one sample point here), MC's rates were slightly more than 1% better than Visa's.

I have a MC credit card that earns 1% cash back, but has a 1% FTF (effectively, 0% FTF with no cash back). I also have a Visa that earns 2% back on travel and restaurants, 1% back on everything else, and has no FTF. But does this mean that, if I'm visiting Japan, it would actually be advantageous for me to use the MC over the Visa, if I'm not purchasing food or travel related items?

Why do the exchange rates differ between Visa and MC so much, and why is one consistently so much better day after day? 0.5-1% may not sound like much, but when you think of the transaction volume that they process, Visa's actually making a lot of money by giving an ever so slightly crappier exchange rate.

mia

There is some relevant information in this thread:

http://www.flyertalk.com/forum/ameri...ates-fees.html

STS-134

Yeah but nfh said in that thread:
Let's look at the rates for GBP/USD last week:
Monday 6/18
MC: 1GBP=1.568699USD
V: 1GBP=1.565528USD
Advantage: V by .202%

Tuesday 6/19
MC: 1GBP=1.574699USD
V: 1GBP=1.572752USD
Advantage: V by .124%

Wednesday 6/20
MC: 1GBP=1.577399USD
V: 1GBP=1.575700USD
Advantage: V by .108%

Thursday 6/21
MC: 1GBP=1.572300USD
V: 1GBP=1.577700USD
Advantage: MC by .342%

Friday 6/22
MC: 1GBP=1.562200USD
V: 1GBP=1.571150USD
Advantage: MC by .570%

Okay, so my assumption about MC always having better rates is false. The better question here is how do I know which card to use? These transactions always post in the FUTURE, based on some (yet to be determined) exchange rate that neither V or MC have made public yet! If the rate delta drifts by more than 1% in MC's favor, than I would want to use the MC for non travel and restaurant related purchases. But they've got to give me the rates ahead of time in order for me to know that.

mia

Correct, you cannot know the exchange rate at the time of the transaction, it is always pegged to the posting date (but is not necessarily the rate on the posting date). To know the rate at the time of purchase you would need to use cash.

MarkMColo

Simple answer: You don't know. Flip a coin?

biggestbopper

It is not possible for a card user to know what rate the card companies will apply before using the card. Since the conversion is done after the fact (assuming you avoid the "dynamic" conversion rip-off).

However, the card companies have used this over the years to hide the giant profits from applying more or less hidden fees and illicit conversion rates, pretending somehow that the innocent banks are at the mercy of Visa and MC (which the banks founded and owned outright for many years).

On an individual basis about all I have been able to do to fight this is to use "no fee" cards such as many from Chase when overseas.