FlyerTalk Forums - View Single Post - Dynamic Currency Conversion (DCC) [2014-2016]
Old Apr 14, 2014 | 6:49 am
  #238  
jbcarioca
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Originally Posted by percysmith
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"I have no proof, but I suspect that for premium cardholders who also travel a great deal most major issuers have an almost automatic reversal of DCC."

That means the bank did not bother to dispute properly. My current attitude is to encourage the bank to actually dispute and give them all required documentation to do so, however if they refuse then we should still take the bank' money because it is compensation for them not doing the job properly and if they are forced to comp enough they might do something about DCC like force visa to police the system properly and get tough with chronic violators like Bank of China.
A client, a major service brand, with whom I have recently worked on dispute/chargeback processing procedures, said that for DCC the transactions processing records do have adequate information for an issuer or intermediate processor (disputes/chargebacks are sometimes handled by specialist processing contracts, especially ones that deal with ATM acquiring and/or international disputes). The records I personally have seen do show adequate native data for ATM issues, and almost always for credit cards too, but sometimes debit cards at POS are a problem due to the different transaction data streams involved.

Thus, for all conventional disputes I agree completely with your comment. For DCC specifically the discrepancy should be in the transaction history and easily accessible. In many problem case the mandated receipt data as shown in the wiki here may not be furnished, in which case the prima facie evidence favours the purchaser and the chargeback is semi-automatic because the transaction does not meet network standards.

The problem with the previous paragraph is that many processors do not have this chargeback process automated and only a couple of major processing systems actually have automated DCC violation rejection. If you want to know that fine detail send me a PM and I'll be happy to tell you which ones I know actually have this automated. The largest US card issuers have very seriously customised internal processing systems and I do not know which among them have automated DCC rejection processes. Among regional banks, credit unions and local banks virtually none have even basic DCC recognition and their common external processors often know almost nothing about it.

Nearly all major processors in what I call 'full EMV' (i.e. chip plus online pin) as applies to most cards issued around the world do have automatic DCC recognition and rejection when not accompanied by consumer authorisation. The 2017 planned migration for US issuers is likely to end out with almost all significant US issuers having automatic DCC processing too.

Sorry about this excessive amount of detail. This subject has frustrated me for years. I think it should be prohibited but merchants love it because it is so very profitable for them. Among a large merchant class we studied DCC alone accounted for almost a third of total imputed net profits for the retailer class. When margins are tight and consumers are ignorant DCC is an irresistible choice, and POS staff are either unaware or are trained deceptively. I'll make wagers that the EU consumer protection policy will somehow act to constrain major networks operating in the EU from permitting DCC on EU-issued cards. Once that happens there will be more pressure on MasterCard/Visa/JCB and ATM networks to disenable the practice.

While dealing with arcane aspects of this, in many duty-free shops around the world the US$ is the currency charged but does not usually have DCC applied. Further in some countries such as Zimbabwe all card charges will be denominated in US$ because Zimabawe no longer has a currency of it's own. In those cases there still can be foreign transaction charges just as there are in the dozen or so small countries which use the US$ as their currency or 100% back their currency with US$. IIRC none of those have DCC because they bill in US$ anyway, and DCC is less commonly used for non-US$ transactions on non US$ cards.
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