I saw this at Francfranc yesterday. A girl used a PRC UnionPay card (magstripe only) with a PIN right after I witnessed her friend had gotten hit with DCC on an RMB-denominated MasterCard. The DCC happened too quickly for me to intervene, and there would have been a language barrier anyway, so I stayed silent. For the UnionPay transaction, the cashier detached the terminal and handed it to the girl so she could enter her PIN.

AFAIK there is no such thing as a "RMB-denominated Mastercard" http://www.paymentlawadvisor.com/201...heir-struggle/

Your cardholder was going to pay 1.75% fee for selecting Mastercard for HKD http://creditcard.bankcomm.com/conte...f/120331-1.pdf

If your cardholder further selected DCC the 1.75% fee will be replaced by 4.2-4.5% DCC processor profit.

The idiotic thing was that since the cards are co-branded the cardholder can pay nil fee by selecting Unionpay directly.

If everyone was posted/converted today:

Direct charge to Unionpay: 100 HKD = 80.12 CNY http://www.unionpayintl.com/MainServ...exchangeRateEn

Charge to Mastercard: 100 HKD = 12.90 USD https://www.mastercard.com/global/cu...ion/index.html
Add 1.75% fee: 13.125 USD
Converted to CNY: 81.47 CNY http://www.boc.cn/sourcedb/whpj/enindex.html

DCC accepted: 100 HKD = 13.48 USD
Converted to CNY: 84.66 CNY

The Unionpay rate isn't exactly the best, but avoiding the 1.75% Foreign Currency Conversion Fee/4.5% DCC scalp and bank foreign exchange spread is definitely worth it.

I observe HK merchants generally offer PRC customers a choice of using the overseas card association or Unionpay without commenting on the merits of either. If I'm standing behind such a customer I will try to get him to say Unionpay as quickly as possible cos it's really the best for him and for me if he stops pondering the question.

This is good to know. I wasn't aware of the co-branded cards, so thanks for the detailed explanation. Francfranc's DCC scalp is 4.9%, and that would be a painful surcharge for someone who could have had none by using UnionPay. :(

Now lots of better dual-currency cards in China have no conversion fees for their Visa/MC part.

Interesting, UnionPay actually recommends using DCC in the US? (http://www.unionpayintl.com/column/e...SA/index.shtml)

Who do you think pays for the $5 billion in annual credit card fraud in the US?

If it is covered by the merchant, it is included in the cost of the items you buy. If it is absorbed by the bank, it comes from the fees you pay for banking, or it reduces the amount of your rewards.

Ultimately, one way or another, you are paying for it.

That is $15 per person. About 1/30 of a credit card sign up bonus.

You mean they only pass on the 1% Visa/MC part of the Foreign Currency Conversion fee or do the PRC banks absorb that too?

No. It's the opposite. They're recommending you select RMB and NOT USD.

Err no. Literally read they are recommending dual-branded cardholders accept DCC!


http://www.unionpayintl.com/column/z...SA/index.shtml

"如使用双标识卡，持卡人在美国无法选择银联网络支付，如商户提供动态货币转换服务（DCC），选择人民币 支付不通过银联网络结算！"

I can't get my head around it though - are the Visa/MC portion of the dual-branded cards now allowed to be denominated in RMB? I thought this was not allowed?

*sigh* I'm an idiot I was the one thinking about it backward earlier... use in China.

Got DCC'd in urumqi at the mercure. Asked to pay cash at checkin but they had charged my card the day before I arrived. Sure enough it DCC'd and I complained at checkout. Guy didn't want to bother the manager at 7am (5am local unofficially). Finally managed to get him to take 25% off my dinner from last night. He would 't even comp the meal. Cheapo.

Sigh. This is another type of DCC I'm in a dilemma about.

Not the first time it happened http://www.flyertalk.com/forum/europ...l#post20829662 .

These generally happen when you book with the hotel direct. The hotel makes you submit your card info online but doesn't charge until a day or two before you check in. A card-not-present charge is then made in the hotel's back office to your card and you're at the hotel's/hotel's acquirer mercy as to whether you will be DCCed or not.

Hotel is meant to get you to agree in writing http://usa.visa.com/download/merchan...n.pdf#page=530 . However I doubt those hotels have read the VIOR or thinks it applies to them - again opt-in and make you work to claw it back.

I haven't tried reversing this in the Hong Kong issuer environment where the burden of proof is (unfairly) placed on the cardholder but I guess keeping a lot of printouts on the agreed (foreign currency) rate with the absence of a DCC opt-in may help.

Of course someone will quip "use Amex la" but that's just shooting myself in the foot to avoid the DCC merchant shooting me isn't it?

---

Paying by an online hotel aggregator will avoid this.

Also I was expecting to get into similar trouble as HGHUA at the Westin Nanshan over 1 January prepaid rate but to my delight when I checked in the receptionist said "we haven't charged your card yet" and allowed me to change the card I wanted to charge and opt out of DCC.

January 2015: Second HK Stopover

I made three credit card purchases.

1. le Relais de l'Entrecôte Hong Kong

Both percysmith and I had wanted to try out a foreign card at this restaurant to test DCC. The acquirer appeared to be First Data based on a previous meal at the restaurant, but when we got the carbon copy bill we saw that it was printed on anonymous coward paper. I ticked HKD and signed. We then both asked 1) what post signature input was entered into the POS terminal and 2) if we could get a reprint of the receipt to show HKD. The cashier obliged, and DCC was averted:

http://i.imgur.com/Q1Vtfb0t.jpghttp://i.imgur.com/xODcHr2t.jpg

DCC Offer: $122.18
DCC Markup: 4.20%
Posted Amount: $117.26
Amount Saved: $4.92

2. Francfranc at iSQUARE in Tsim Sha Tsui

I had already purchased from this store before, so I know that they honor DCC wishes as long as you specify. (I saw someone succumb to DCC right before me, but there was a language barrier.)

http://i.imgur.com/t3vnF1qt.jpg

DCC Offer: $230.23
DCC Markup: 4.90%
Posted Amount: $219.28
Amount Saved: $10.95

3. Courtyard Hong Kong

This place is curious because I have never seen DCC, even for the preauthorzation charge. (The front desk bills in HKD and uses a Bank of China POS terminal.) I don't know if DCC is opt-in at this hotel, but I'm not about to find out. I reiterated HKD at checkout and signed a receipt without seeing the DCC verbiage, so I don't know what the markup is:

http://i.imgur.com/3wsccy1t.jpg

Amount saved by opting out of DCC: $15.87

Ha! We finally found a case where DCC was saving you 25% ;)

Anyone which got DCC scammed in the last days in Switzerland (and the regular conversation was only due today or later) saved 30% on currency exchange, as the SNB just stopped their 1.20 rate and the CHF gained 30% against all currencies.

So, any foreigners who bough stuff at ZRH yesterday and got scammed - you didn't. You scammed back ;)