I came VERY close to this in Tunisia on NYE. For some reason Schwab flagged my ATM card and shut me down from withdrawing cash. I also had my Chase ATM card (at $3+3% ) and that was denied at one bank as well. Fortunately it did work at a second bank and so my 5th attempt to withdraw local cash was ultimately successful. I had a couple hundred in USD that I could have exchanged and survived but it was a bit frustrating, particularly added on to a misconnect, forced overnight in CMN and a lost bag.

Unless you are willing to bet on the exchange rate sliding a few percent in your favor, in which case paying the penalty in advance makes sense, I'd just deal on arrival.