Jan 18, 2014, 10:10 pm
Last edit by: emilio911
What is it?
Dynamic Currency Conversion (DCC) is a "service" some merchants and ATM operators offer that will charge a cardholder in the native currency of the card rather than the local currency. A more complete definition and examples are available via this Wikipedia article on DCC. While sold as a convenience to cardholders traveling outside of their home country, it is a pure profit play by the merchants. You may end up paying a fee of up to 8% over the purchase price for accepting DCC. Always decline DCC and asked to be billed in the local currency!
Where will I see it?
You can be hit with DCC anywhere there is a difference between your debit or credit card's denominated currency and the currency of the location where you're trying to use the card. The most common example will be at a merchant overseas, but now some ATMs are offering the service too. While many US cardholders complain about getting tricked into accepting DCC overseas, some merchants in the US have started to use DCC as well.
What is the issue?
Unless you're the merchant or ATM operator, there isn't much benefit to using DCC. Some customers say they prefer knowing exactly how much they'll be charged in their home currency or may not know the exchange rate of the place where they are visiting. For example, if you are in Prague for two days and you don't know how much the Czech Koruna is worth relative to the US Dollar, you might feel more comfortable knowing that you're buying an item for $205.00 versus 4000 CZK. However, the real exchange rate as of January 18, 2014 would place 4000 CZK at $197.18. You just paid an extra $7.82 for the "convenience" of knowing how much you'd be charged!
DCC often charges about a 4% premium over the true exchange rate. The problems don't stop there since many US banks still charge a 3% foreign transaction fee (FTF) for purchases made outside of the US. Not only would you get hit with the $205.00 charge, you could also find yourself facing a total charge of $211.15 if your card has a 3% FTF.
This is a pure money grab from the merchants, and it's billed as an easy way to squeeze additional revenue out of the transaction. Numerous [1, 2] articles have talked about DCC duping many consumers. Discover even has a warning about being tricked into DCC when using a card abroad.
For example, this FlyerTalk member reported that Avis charged his Saudi credit card in Saudi riyals instead of USD for a car rental in Florida without his consent. This has also been a trend for hotels, particularly large chains as indicated here and here.
DCC is simply not worth it for the consumer. Unless you like paying a convenience fee of up to 5% of the total transaction just to know how much you will be billed, you should always decline DCC and ask to be billed in local currency when handing over your card.
Furthermore, it is in your interest to obtain a card that has a 0% FTF. FlyerTalk member kebosabi maintains a fairly comprehensive spreadsheet of EMV-enabled cards ideal for overseas travel, many of which offer a low or 0% FTF as a feature. There is also a wiki at FlyerGuide of various FTF of debit and credit cards.
What can I do to avoid DCC?
American Express currently does not support DCC on its network, so you are safe from DCC if using an American Express card. However, Visa and MasterCard card networks can support DCC, so be vigilant when purchasing abroad with a Visa or MasterCard branded card. There have been reports of being charged DCC with a Discover card in China [citation needed], but primarily the issue is happening with Visa and MasterCard cards.
Before handing your card to the merchant, always specify clearly that you want to be charged in the local currency and that you do not want DCC. For some transactions, you retain control of your card as you dip it into a chip reader and can view on a screen to select which currency you want to use for the transaction. Always select the local currencyto get the best exchange rate. Do not select the card's native currency!
Similarly, for ATM withdrawals, make sure you decline any kind of conversions. Some good examples of what to look for when using an ATM overseas are here and here. You're probably coming off of a long flight and fatigued, but educating yourself beforehand can save you from getting ripped off. The user interfaces on almost all of these ATMs are set up to encourage you to take the bait, and you have to be extremely vigilant not to fall for it.
If you are doing a PIN-based transaction, you should have the opportunity to review the total amount and denomination of the transaction before entering your PIN. If you are doing a signature transaction and the merchant has processed your transaction with DCC, cross out the amount and write "DCC refused" on the receipt. Do not sign the receipt, and demand that the merchant reverse the transaction and run it in the local currency. If no verification is required due to a small purchase amount, ask the merchant to reverse the charge and repeat the transaction using local currency. If all else fails, file a dispute with your card issuer when you return home. Even if it's immaterial, the banks will get the message like they did with EMV.
Some merchants will claim that their systems have to bill you in your native currency. This is a complete lie. But just like a mag stripe only card, this is battle where you have to be prepared. Don't settle for merchants claiming that "it has to be done this way" or "pay cash if you don't want this". Be prepared to walk away, and, if you must complete the transaction, write "DCC refused & merchant didn't give a choice" on the receipt and cross out the amount. Let the merchant know that you will be filing a dispute with your bank.
Disabling DCC
Disabling DCC on ANZ terminals in Australia
ANZ markets DCC as Customer Preferred Currency (CPC). Terminal operators can contact ANZ Merchant Services at 1800 039 025 to have this feature disabled. Currently, your Visa or MasterCard will be subjected to DCC if denominated in: CAD, CHF, DKK, EUR, GBP, HKD, JPY, MYR, NOK, NZD, SEK, SGD, THB, USD, or ZAR. All DCC transactions on ANZ will cause a 2.5% markup. Steps to avoid DCC:
If you see a signature slip with DCC verbiage and a checkbox indicating a currency selection, kindly ask the merchant to void the transaction. If it's a PIN-based transaction, you have an additional opportunity to cancel the transaction because it will ask for your PIN a second time. For instance, if you see "EUR 17.29 KEY PIN" refuse to enter your PIN and start again.
Disabling DCC in China
There are many reports of forced DCC in China, and there is a great thread [closed to new posts] on DCC in China on the the China Destinations forum.
Disabling DCC on Bankcomm terminals in Beijing http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #19
jair101's DCC instructions of March 2011 http://www.etveg.com/misc/DCC_China.pdf
Disabling DCC in Eurozone and UK
DCC offered in tourist traps (Harrods Knightsbridge/Galleries Lafayette Montparnesse/El Cortes Ingles Grand Via Madrid)
Unlike the rest of the world, Visa Europe does not require merchants to collect a ticked box on the slip (presumably because merchants there don't keep signed slips under Chip-and-PIN)
El Cortes Ingles collects a signature electronically and the DCC selection is made on the signature pad - the choice is respected.
Harrods and GL rely on cashier input in the POS for the currency choice - the cashier may forget to ask. The POS do not offer voiding (only refunds), but since you're given a slip to sign the best thing to do is to deface it before signing and submit chargeback request to issuer bank on return home.
There may be smaller merchants who also collect DCC but I seemed to have pre-empted most of them by saying "charge Euros (Pounds) please"
In Spain all merchants by law are required to provide you with a complaint form called an hoja de reclamaciones if requested. The form has two carbon copies. The customer retains one copy as a record of the complaint. The merchant maintains another copy, and the third is sent to the local consumer protection bureau. Merchants are also required to post a sign conspicuously informing the customer of the right to complain (usually in Spanish and English). Do not accept the lie that they don't have any forms. This is illegal, and you are able to call the police if the merchant refuses to provide you with this official form. It's interesting to see merchants start to squirm when you know the rules, and most merchants will start to be accommodating after you mention it. (Please still fill out the form even if the merchant cooperates after mentioning it because these are likely the merchants who won't otherwise change their behavior.)
Disabling DCC in Hong Kong and Macau
Hong Kong and Macau can get as non-compliant as China, possibly because many acquirers have cross-border operations and know they can get away with non-compliant firmware and procedures.
In practice, if you are given a DCC slip, and the cashier has not taken a choice before giving you your copy, the slip will be processed in your home currency - be prepared to dispute.
Unable to disable Global Payments DCC in Hong Kong instance #1, instance #2
Unable to disable DBS DCC in Fortress Electronics HK
Unable to disable BoC DCC in Free Duty HK
Disabling DCC in Japan and Korea
Japan's just starting out http://www.flyertalk.com/forum/japan...ing-japan.html and http://www.hongkongcard.com/forum/fo...p?id=3939&p=17 #168 but there are no reports I know of where cardholders are compelled to use DCC against their will.
Korea is also not much affected by DCC but where offered, trying to opt out is harder than Japan due to the language barrier (both verbal and written)
http://www.hongkongcard.com/forum/fo...hp?id=4303&p=3 #23
http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #11
Disabling DCC in the Maldives
Disabling DCC on Global Payment terminals in the Maldives
Disabling DCC in Thailand and Taiwan
DCC present but generally not an issue. Cashier will generate quote slip is usually generated and pass to cardholder. When cardholder refuses, a verbage-free slip denominated in THB/TWD will be produced.
Certain Taiwan hotels may take deposits in cardholder currency. But these are only pre-authorisations and can be voided in full for TWD-only final checkout payments.
Disabling DCC on Websites
Airbnb - (Since the "loophole" seem not to work anymore, please report if you chargeback the DCC.
)
Hotwire - You need to select your preferred currency before making a search.
PayPal - The instructions to stop the DCC on a recurring charge are here.
I got duped by DCC already before I found this thread. Is there anything I can do?
If you've been hit with DCC and the merchant did not follow the Visa/MC rules, you should file a dispute with your card issuer. Even if the transaction is a small amount, it's worth it to dispute the charge on principle. Do not let merchants get away with this scam uncontested!
If you were not clearly given a choice of currencies and did not specifically communicate a preference to be billed in your card's native currency - if you did not accept DCC - then you have recourse when filing a dispute with your card issuer. The Visa Product and Service Rules clearly state (p 339):
You can even use terminology from Visa Product and Service Rules when filing the dispute, giving Reason Code 76: Incorrect Currency or Transaction Code. Reason Code 76 is used when the transaction was processed with an incorrect transaction code, or an incorrect currency code, or one of the following:
MasterCard's rules also clearly state that the POI Currency Conversion must be decided by both the merchant and customer. When filing a dispute with a MasterCard, list chargeback Reason Code 4846 from the MasterCard Chargeback Guide, which covers POI currency conversion disputes in the following circumstances:
You do have a choice of currencies. Exercise that choice!
Do not get taken by surprise when faced with DCC, and know your options. As Visa/MC purport, you do have a choice of currencies, but you need to make that choice heard! Don't be complacent in this sneaky tactic by some merchants to pad revenues.
Before going to a different country, get educated. Understand the exchange rate relative to your native currency. Know how to recognize when the merchant is trying to force DCC on the transaction, and pull out all of the stops to make sure it doesn't happen to you.
If you have a chip-and-PIN credit card, it's easier to control the transaction to try to prevent DCC. With chip-and-signature, if you get an uncooperative merchant, deface the merchant's copy of the receipt. Write LOCAL OPTION NOT OFFERED, cross out the DCC currency amount, and sign the receipt.
This will give additional evidence when filing a dispute to get the DCC charges refunded. When filing the dispute, you can use the Visa Exchange Rate Calculator or MasterCard's Currency Conversion Tool to determine the Visa or MasterCard exchange rate on the date the transaction posted to your credit card. Compare this to the DCC value to figure out the amount by which the merchant overcharged you. Don't forget to add in any Foreign Transaction Fee if your card has one. (If it does, you should really consider finding a card for use overseas without a FTF.)
Example Images (click for a larger image)
Hotel receipts in China, the Netherlands, and Dubai respectively:
Purchase receipts in China and Korea:
Cancelled translation in Hong Kong:
Novotel in Shenzen:
Dynamic Currency Conversion (DCC) is a "service" some merchants and ATM operators offer that will charge a cardholder in the native currency of the card rather than the local currency. A more complete definition and examples are available via this Wikipedia article on DCC. While sold as a convenience to cardholders traveling outside of their home country, it is a pure profit play by the merchants. You may end up paying a fee of up to 8% over the purchase price for accepting DCC. Always decline DCC and asked to be billed in the local currency!
Where will I see it?
You can be hit with DCC anywhere there is a difference between your debit or credit card's denominated currency and the currency of the location where you're trying to use the card. The most common example will be at a merchant overseas, but now some ATMs are offering the service too. While many US cardholders complain about getting tricked into accepting DCC overseas, some merchants in the US have started to use DCC as well.
What is the issue?
Unless you're the merchant or ATM operator, there isn't much benefit to using DCC. Some customers say they prefer knowing exactly how much they'll be charged in their home currency or may not know the exchange rate of the place where they are visiting. For example, if you are in Prague for two days and you don't know how much the Czech Koruna is worth relative to the US Dollar, you might feel more comfortable knowing that you're buying an item for $205.00 versus 4000 CZK. However, the real exchange rate as of January 18, 2014 would place 4000 CZK at $197.18. You just paid an extra $7.82 for the "convenience" of knowing how much you'd be charged!
DCC often charges about a 4% premium over the true exchange rate. The problems don't stop there since many US banks still charge a 3% foreign transaction fee (FTF) for purchases made outside of the US. Not only would you get hit with the $205.00 charge, you could also find yourself facing a total charge of $211.15 if your card has a 3% FTF.
This is a pure money grab from the merchants, and it's billed as an easy way to squeeze additional revenue out of the transaction. Numerous [1, 2] articles have talked about DCC duping many consumers. Discover even has a warning about being tricked into DCC when using a card abroad.
For example, this FlyerTalk member reported that Avis charged his Saudi credit card in Saudi riyals instead of USD for a car rental in Florida without his consent. This has also been a trend for hotels, particularly large chains as indicated here and here.
DCC is simply not worth it for the consumer. Unless you like paying a convenience fee of up to 5% of the total transaction just to know how much you will be billed, you should always decline DCC and ask to be billed in local currency when handing over your card.
Furthermore, it is in your interest to obtain a card that has a 0% FTF. FlyerTalk member kebosabi maintains a fairly comprehensive spreadsheet of EMV-enabled cards ideal for overseas travel, many of which offer a low or 0% FTF as a feature. There is also a wiki at FlyerGuide of various FTF of debit and credit cards.
What can I do to avoid DCC?
American Express currently does not support DCC on its network, so you are safe from DCC if using an American Express card. However, Visa and MasterCard card networks can support DCC, so be vigilant when purchasing abroad with a Visa or MasterCard branded card. There have been reports of being charged DCC with a Discover card in China [citation needed], but primarily the issue is happening with Visa and MasterCard cards.
Before handing your card to the merchant, always specify clearly that you want to be charged in the local currency and that you do not want DCC. For some transactions, you retain control of your card as you dip it into a chip reader and can view on a screen to select which currency you want to use for the transaction. Always select the local currencyto get the best exchange rate. Do not select the card's native currency!
Similarly, for ATM withdrawals, make sure you decline any kind of conversions. Some good examples of what to look for when using an ATM overseas are here and here. You're probably coming off of a long flight and fatigued, but educating yourself beforehand can save you from getting ripped off. The user interfaces on almost all of these ATMs are set up to encourage you to take the bait, and you have to be extremely vigilant not to fall for it.
If you are doing a PIN-based transaction, you should have the opportunity to review the total amount and denomination of the transaction before entering your PIN. If you are doing a signature transaction and the merchant has processed your transaction with DCC, cross out the amount and write "DCC refused" on the receipt. Do not sign the receipt, and demand that the merchant reverse the transaction and run it in the local currency. If no verification is required due to a small purchase amount, ask the merchant to reverse the charge and repeat the transaction using local currency. If all else fails, file a dispute with your card issuer when you return home. Even if it's immaterial, the banks will get the message like they did with EMV.
Some merchants will claim that their systems have to bill you in your native currency. This is a complete lie. But just like a mag stripe only card, this is battle where you have to be prepared. Don't settle for merchants claiming that "it has to be done this way" or "pay cash if you don't want this". Be prepared to walk away, and, if you must complete the transaction, write "DCC refused & merchant didn't give a choice" on the receipt and cross out the amount. Let the merchant know that you will be filing a dispute with your bank.
Disabling DCC
Disabling DCC on ANZ terminals in Australia
ANZ markets DCC as Customer Preferred Currency (CPC). Terminal operators can contact ANZ Merchant Services at 1800 039 025 to have this feature disabled. Currently, your Visa or MasterCard will be subjected to DCC if denominated in: CAD, CHF, DKK, EUR, GBP, HKD, JPY, MYR, NOK, NZD, SEK, SGD, THB, USD, or ZAR. All DCC transactions on ANZ will cause a 2.5% markup. Steps to avoid DCC:
- Insert, swipe, or tap your payment card
- Have the cashier select credit (CR)
- The terminal will display CREDIT ACCOUNT
- If applicable, enter your PIN
- The terminal will display PROCESSING \ PLEASE WAIT
- The terminal will display EXCH <exchange rate> \ <currency> <amount> \ ACCEPT RATE? \ ENTER=YES CLR=NO
- Instruct the cashier to press the yellow CLEAR (CLR) button (If entering a PIN, you can retain the terminal to perform this step yourself. If entering a signature, you can ask for the terminal to control this process, not indicating that it's a chip-and-signature card.)
- The transaction should now process without DCC
If you see a signature slip with DCC verbiage and a checkbox indicating a currency selection, kindly ask the merchant to void the transaction. If it's a PIN-based transaction, you have an additional opportunity to cancel the transaction because it will ask for your PIN a second time. For instance, if you see "EUR 17.29 KEY PIN" refuse to enter your PIN and start again.
Disabling DCC in China
There are many reports of forced DCC in China, and there is a great thread [closed to new posts] on DCC in China on the the China Destinations forum.
Disabling DCC on Bankcomm terminals in Beijing http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #19
jair101's DCC instructions of March 2011 http://www.etveg.com/misc/DCC_China.pdf
Disabling DCC in Eurozone and UK
DCC offered in tourist traps (Harrods Knightsbridge/Galleries Lafayette Montparnesse/El Cortes Ingles Grand Via Madrid)
Unlike the rest of the world, Visa Europe does not require merchants to collect a ticked box on the slip (presumably because merchants there don't keep signed slips under Chip-and-PIN)
El Cortes Ingles collects a signature electronically and the DCC selection is made on the signature pad - the choice is respected.
Harrods and GL rely on cashier input in the POS for the currency choice - the cashier may forget to ask. The POS do not offer voiding (only refunds), but since you're given a slip to sign the best thing to do is to deface it before signing and submit chargeback request to issuer bank on return home.
There may be smaller merchants who also collect DCC but I seemed to have pre-empted most of them by saying "charge Euros (Pounds) please"
In Spain all merchants by law are required to provide you with a complaint form called an hoja de reclamaciones if requested. The form has two carbon copies. The customer retains one copy as a record of the complaint. The merchant maintains another copy, and the third is sent to the local consumer protection bureau. Merchants are also required to post a sign conspicuously informing the customer of the right to complain (usually in Spanish and English). Do not accept the lie that they don't have any forms. This is illegal, and you are able to call the police if the merchant refuses to provide you with this official form. It's interesting to see merchants start to squirm when you know the rules, and most merchants will start to be accommodating after you mention it. (Please still fill out the form even if the merchant cooperates after mentioning it because these are likely the merchants who won't otherwise change their behavior.)
Disabling DCC in Hong Kong and Macau
Hong Kong and Macau can get as non-compliant as China, possibly because many acquirers have cross-border operations and know they can get away with non-compliant firmware and procedures.
In practice, if you are given a DCC slip, and the cashier has not taken a choice before giving you your copy, the slip will be processed in your home currency - be prepared to dispute.
Unable to disable Global Payments DCC in Hong Kong instance #1, instance #2
Unable to disable DBS DCC in Fortress Electronics HK
Unable to disable BoC DCC in Free Duty HK
Disabling DCC in Japan and Korea
Japan's just starting out http://www.flyertalk.com/forum/japan...ing-japan.html and http://www.hongkongcard.com/forum/fo...p?id=3939&p=17 #168 but there are no reports I know of where cardholders are compelled to use DCC against their will.
Korea is also not much affected by DCC but where offered, trying to opt out is harder than Japan due to the language barrier (both verbal and written)
http://www.hongkongcard.com/forum/fo...hp?id=4303&p=3 #23
http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #11
Disabling DCC in the Maldives
Disabling DCC on Global Payment terminals in the Maldives
Disabling DCC in Thailand and Taiwan
DCC present but generally not an issue. Cashier will generate quote slip is usually generated and pass to cardholder. When cardholder refuses, a verbage-free slip denominated in THB/TWD will be produced.
Certain Taiwan hotels may take deposits in cardholder currency. But these are only pre-authorisations and can be voided in full for TWD-only final checkout payments.
Disabling DCC on Websites
Airbnb - (Since the "loophole" seem not to work anymore, please report if you chargeback the DCC.
)Hotwire - You need to select your preferred currency before making a search.
PayPal - The instructions to stop the DCC on a recurring charge are here.
I got duped by DCC already before I found this thread. Is there anything I can do?
If you've been hit with DCC and the merchant did not follow the Visa/MC rules, you should file a dispute with your card issuer. Even if the transaction is a small amount, it's worth it to dispute the charge on principle. Do not let merchants get away with this scam uncontested!
If you were not clearly given a choice of currencies and did not specifically communicate a preference to be billed in your card's native currency - if you did not accept DCC - then you have recourse when filing a dispute with your card issuer. The Visa Product and Service Rules clearly state (p 339):
- Merchants that offer DCC must be compliant with the regulations
- Inform the cardholder that DCC is optional
- Not impose any additional requirements to use local currency
- Not use any language or procedures that may cause the cardholder to choose DCC by default
- Not convert a transaction in the local currency to the card's billing currency after the transaction has completed
- Ensure that the cardholder expressly agrees to DCC
You can even use terminology from Visa Product and Service Rules when filing the dispute, giving Reason Code 76: Incorrect Currency or Transaction Code. Reason Code 76 is used when the transaction was processed with an incorrect transaction code, or an incorrect currency code, or one of the following:
- Merchant did not deposit a transaction receipt in the country where the transaction occurred
- Cardholder was not advised that Dynamic Currency Conversion (DCC) would occur
- Cardholder was refused the choice of paying in the merchants local currency
- Merchant processed a credit refund and did not process a reversal or adjustment within 30 calendar days for a transaction receipt processed in error
MasterCard's rules also clearly state that the POI Currency Conversion must be decided by both the merchant and customer. When filing a dispute with a MasterCard, list chargeback Reason Code 4846 from the MasterCard Chargeback Guide, which covers POI currency conversion disputes in the following circumstances:
- The cardholder states that he or she was not given the opportunity to choose the desired currency in which the transactions was completed or did not agree to the currency of the transaction, or
- POI currency conversion took place into a currency that is not the cardholder's billing currency, or
- POI currency conversion took place when the goods or services were priced in the cardholder's billing currency, or
- POI currency conversion took place when cash was disbursed in the cardholdeer's billing currency.
You do have a choice of currencies. Exercise that choice!
Do not get taken by surprise when faced with DCC, and know your options. As Visa/MC purport, you do have a choice of currencies, but you need to make that choice heard! Don't be complacent in this sneaky tactic by some merchants to pad revenues.
Before going to a different country, get educated. Understand the exchange rate relative to your native currency. Know how to recognize when the merchant is trying to force DCC on the transaction, and pull out all of the stops to make sure it doesn't happen to you.
If you have a chip-and-PIN credit card, it's easier to control the transaction to try to prevent DCC. With chip-and-signature, if you get an uncooperative merchant, deface the merchant's copy of the receipt. Write LOCAL OPTION NOT OFFERED, cross out the DCC currency amount, and sign the receipt.
This will give additional evidence when filing a dispute to get the DCC charges refunded. When filing the dispute, you can use the Visa Exchange Rate Calculator or MasterCard's Currency Conversion Tool to determine the Visa or MasterCard exchange rate on the date the transaction posted to your credit card. Compare this to the DCC value to figure out the amount by which the merchant overcharged you. Don't forget to add in any Foreign Transaction Fee if your card has one. (If it does, you should really consider finding a card for use overseas without a FTF.
)Example Images (click for a larger image)
Hotel receipts in China, the Netherlands, and Dubai respectively:
Purchase receipts in China and Korea:
Cancelled translation in Hong Kong:
Novotel in Shenzen:
Dynamic Currency Conversion (DCC) [2014-2016]
Mar 24, 2015 | 8:52 am
#1786
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
I agree whether the fee is separately billed depends on ATM as I have seen the separately billed ATM fees before - both on Schwab's and on Fido's.
Last year on the receipts from ATM at ICN and BKK, the ATM fees were shown in details but of course the withdrawals were net amounts. All fees were reimburded.
On this particular withdrawal in Turkey the ATM receipt only showed the amount withdrew, 100 TY, nothing else. It has been almost 2 weeks from the withdrawal, no additional item shows up at Schwab's site. It does seem weird because the machine clearly display $4 ATM fee and asked if I wanted to accept it to continue.
Last year on the receipts from ATM at ICN and BKK, the ATM fees were shown in details but of course the withdrawals were net amounts. All fees were reimburded.
On this particular withdrawal in Turkey the ATM receipt only showed the amount withdrew, 100 TY, nothing else. It has been almost 2 weeks from the withdrawal, no additional item shows up at Schwab's site. It does seem weird because the machine clearly display $4 ATM fee and asked if I wanted to accept it to continue.
I think maybe Schwab uses the posted USD amount to determine the local amount. Because ATMs can only disperse amounts in at least tens, Schwab can then use this to determine the original local amount and figure out the USD equivalent of the fee. This is the way I can think of.
If this is true, I'm interested to see what would happen if foreign ATM transactions are DCCed. With a ATM transaction of XX.XX USD, will Schwab just reimburse X.XX or (X.XX - 5) (if X.XX is greater than 5) back to you???
Mar 24, 2015 | 5:18 pm
#1787
Join Date: Oct 2007
Programs: AA, WN, UA, Bonvoy, Hertz
Posts: 2,718
Significant Capital One FTF advantage
Hello,
So over the years, I have been monitoring currency conversion. I think we all look for no explicit FTF (issuer added) as a good sign, but I still felt that there were differences I couldn't explain. Even with the Euro at a significant discount to previous years, Capital One appears to continue to even waive the Visa or MC part of the rate (not sure if this is official).
Here is one example of the tale of two charges both from the same merchant made on the same day (and posted, two days later at the same day).
258 Euro charge, charged to Chase Marriott Signature Visa (no FTF except the Visa fee), posted on 3/23 - 280.75 USD (1.0881 USD to EUR - matches Visa website exactly).
198 Euro charge, charged to Capital One QS WE MasterCard (no FTF including MC fee), posted on 3/23 - 211.01 USD (1.0657 USD to EUR - seems like more than a 2.6% savings compared to the listed MC rate). The Visa rate by the way slightly better than the MasterCard website listed rate which indicates to me that Visa did more volume that settlement day than MasterCard and was able to get a better rate.
So, when we are chasing a few percent of cash back or equivalent, why wouldn't we be considering the actual exchange rates more often for our preferred card of choice overseas? That seems to more than offset the slightly lower rebate value of Capital One's consumer cards. I admit that it is hard to manage to that level of detail, but in general, if Capital One is removing the full exchange rate overhead, that seems to be as close to being a major international banker as one can get.
I am lucky to have a few issuers I can test including BofA (historic FIA card with no FTF), Barclay (newer no FTF policy) and the aforementioned cards. However, I don't use them like this very often in international rotation.
Rasheed
So over the years, I have been monitoring currency conversion. I think we all look for no explicit FTF (issuer added) as a good sign, but I still felt that there were differences I couldn't explain. Even with the Euro at a significant discount to previous years, Capital One appears to continue to even waive the Visa or MC part of the rate (not sure if this is official).
Here is one example of the tale of two charges both from the same merchant made on the same day (and posted, two days later at the same day).
258 Euro charge, charged to Chase Marriott Signature Visa (no FTF except the Visa fee), posted on 3/23 - 280.75 USD (1.0881 USD to EUR - matches Visa website exactly).
198 Euro charge, charged to Capital One QS WE MasterCard (no FTF including MC fee), posted on 3/23 - 211.01 USD (1.0657 USD to EUR - seems like more than a 2.6% savings compared to the listed MC rate). The Visa rate by the way slightly better than the MasterCard website listed rate which indicates to me that Visa did more volume that settlement day than MasterCard and was able to get a better rate.
So, when we are chasing a few percent of cash back or equivalent, why wouldn't we be considering the actual exchange rates more often for our preferred card of choice overseas? That seems to more than offset the slightly lower rebate value of Capital One's consumer cards. I admit that it is hard to manage to that level of detail, but in general, if Capital One is removing the full exchange rate overhead, that seems to be as close to being a major international banker as one can get.
I am lucky to have a few issuers I can test including BofA (historic FIA card with no FTF), Barclay (newer no FTF policy) and the aforementioned cards. However, I don't use them like this very often in international rotation.
Rasheed
Mar 24, 2015 | 9:08 pm
#1788
Join Date: Dec 2007
Location: MSP
Programs: Delta 1 MM, Platinum. Marriott-Hilton Gold
Posts: 313
Good points. Most of my trips are business trips. While I am not going to get my employer ripped off through DCC, I am also looking at maximizing my cash back. So while Amex Costco charges me 3% FTF, it gives me 3% only on US restaurants and travel. So I plan to use my Sams Master card which is 3% travel worldwide even though they do charge 3% FTF. My Capital one QS is fee free and no FTF. But that is a subprime card company where they are stingy with credit limits. Even though my balance is close to 6 figures in the checking/savings, my credit limit is only $12.5k which renders the card useless to my household spending limits. I thus prefer my $45k UNFCU Visa or $35k Sams Master Card or even $25 Amex Costco. If my QS had at least $25k limit, I would have happily used it. So my QS is generally locked up and used occasionally for small personal expenses overseas. A good thing about the card for US usage is that like UNFCU card it is also on Apple pay.
Is your limits on QS liberal enough for your usage?
Is your limits on QS liberal enough for your usage?
Mar 24, 2015 | 10:27 pm
#1789
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
So, when we are chasing a few percent of cash back or equivalent, why wouldn't we be considering the actual exchange rates more often for our preferred card of choice overseas? That seems to more than offset the slightly lower rebate value of Capital One's consumer cards. I admit that it is hard to manage to that level of detail, but in general, if Capital One is removing the full exchange rate overhead, that seems to be as close to being a major international banker as one can get.
Mine was worse at $2000. This was also in the days before FlyerTalk (and associated churning and manufactured spending) for me when my credit was impeccable. However, in the 3 years I had that card they never granted me a credit limit increase. Once Chase and AmEx Platinum started to offer 0% FTF as a feature, I promptly dropped the card. I'm a little worried about the switchover from Costco AmEx to Capital One. We'll see if things transfer in kind.
Mar 25, 2015 | 9:14 am
#1790
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
Visa website rates don't include the 1%, and Chase rates always match the Visa rate. Chase don't charge its 2% and eats the Visa's 1%. If Chase charges FTF, it's gonna be a single charge which includes both (as the ones on my old and deceased Chase Freedom card).
Everybody please correct me if I'm wrong.
My guess is that Capital One's posting date rates were different from the ones that OP thought were the actual posting rates. Maybe if we find another time when currency fluctuation isn't huge, we can see Capital One rates matching MC rates?
My experience with Chase MC IHG card is that it always uses the MC rates. It's a true 0% as well. If OP's Capital One card is the true 0% and mines aren't, we would see 1% in saving instead of 2.6%, right?
Mar 25, 2015 | 1:43 pm
#1791
Join Date: Mar 2015
Location: Las Vegas
Programs: United Platinum, IHG Spire Ambassador, Hilton Diamond
Posts: 291
AirAsia DCC
I'm pretty sure I got hit with DCC last night booking tickets online with AirAsia (on a Citibank, no FTF MasterCard).
I tried to pay in Indonesian Rupiah at the payment screen; the total amount was 4,780,000 IDR, equivalent to US$368.12. First attempt denied. On the phone with Citibank I was told that their fraud department was NOT blocking the charge; they weren't showing an authorization request coming in on their side at all. While still on the phone, I tried again, and once again was denied.
On the payment page I changed the currency to US dollars and was quoted $386.61, an higher price of $18.49, and almost exactly 5% higher.
The charge in US dollars was approved on the same card.
At no point did any DCC verbiage stating that I had a right to choose currencies, and paying in my home currency would result in a 5% convenience charge show up. Just "this is the price in dollars."
My receipt, however, shows that I paid 4,780,000 IDR under the "total paid" section. (And this is AFTER paying a 200,000 IDR / US$15.40 processing fee for using a credit card!)
My question is, does this qualify as DCC or just a merchant selling one item at different prices across different currencies?
I tried to pay in Indonesian Rupiah at the payment screen; the total amount was 4,780,000 IDR, equivalent to US$368.12. First attempt denied. On the phone with Citibank I was told that their fraud department was NOT blocking the charge; they weren't showing an authorization request coming in on their side at all. While still on the phone, I tried again, and once again was denied.
On the payment page I changed the currency to US dollars and was quoted $386.61, an higher price of $18.49, and almost exactly 5% higher.
The charge in US dollars was approved on the same card.
At no point did any DCC verbiage stating that I had a right to choose currencies, and paying in my home currency would result in a 5% convenience charge show up. Just "this is the price in dollars."
My receipt, however, shows that I paid 4,780,000 IDR under the "total paid" section. (And this is AFTER paying a 200,000 IDR / US$15.40 processing fee for using a credit card!)
My question is, does this qualify as DCC or just a merchant selling one item at different prices across different currencies?
Last edited by LASNRT; Mar 25, 2015 at 1:59 pm
Mar 25, 2015 | 6:41 pm
#1792
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,114
vegascraig:
1. One one hand Indonesian merchants cannot charge anything but IDR by virtue of Indonesian law http://www.flyertalk.com/forum/china...on-61.html#904
2. OTOH Thai Airasia charges out of Malaysian headquarters http://www.hongkongcard.com/forum/fo...w.php?id=11968 (the Airasia charge was for Thai Airasia), so maybe Airasia Indonesia charges out of Malaysia as well?
1. One one hand Indonesian merchants cannot charge anything but IDR by virtue of Indonesian law http://www.flyertalk.com/forum/china...on-61.html#904
2. OTOH Thai Airasia charges out of Malaysian headquarters http://www.hongkongcard.com/forum/fo...w.php?id=11968 (the Airasia charge was for Thai Airasia), so maybe Airasia Indonesia charges out of Malaysia as well?
Mar 25, 2015 | 6:47 pm
#1793
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
Air New Zealand website can do the same thing. But it didn't stop me from actually paying in NZD. And of course paying in USD resulted more if the price was originally quoted in NZD.
Basically your product is quoted in one base currency, and every other currency will include a conversion loss sort of thing.
In this case AirAsia's system was having a problem and it self-denied IDR transactions. I had the same problem with Air China that the CNY transactions were denied on Chase cards. The difference is that Chase saw authorizations, but it wasn't Chase who denied them. Air China's system just though there was something wrong and stopped the transactions after successful authorizations.
Mar 25, 2015 | 8:48 pm
#1794
Original Poster
Join Date: Jul 2009
Location: SJC
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Posts: 6,961
Mar 25, 2015 | 10:08 pm
#1795
Join Date: Mar 2015
Location: Las Vegas
Programs: United Platinum, IHG Spire Ambassador, Hilton Diamond
Posts: 291
This is the exact amount offered by AirAsia at purchase, and even shown on another copy of an invoice I was emailed. This was not the exchange rate used by Citibank or MasterCard, it was AirAsia's arbitrary amount in USD (5% higher than the true exchange rate). I just tried to recreate this purchase on their website, and purchases in IDR and MYR were the same price, but USD, AUD and EUR purchases all had a 5% markup.
Also, on my booking screen, I can see the three transactions (card number redacted but all on the same card), the two declined in IDR and the one approved in USD:
Thank you all for your opinions and advice. I only wish the IDR transactions would have gone through. I guess I won't complain too much about the extra $18 though; it's still nice to be able to get lie-flat business class seats on a 6 hour flight for less than US$200 each
Mar 26, 2015 | 12:23 am
#1796
FlyerTalk Evangelist
Join Date: Jul 2003
Location: Florida
Posts: 30,343
Pending is always in native currency - this is true for almost all banks' cards I have - AMEX, Citi, Chase, Barclays and BofA. However once transactions are POSTED, you can then click on the line and open up the description where you will see the foreign currency. Some banks wouldn't show it until statement. I dont remember the nuisance of each bank.
You would need to wait till posted transaction or statement close, in order to see the foreign currency billed. Only when no foreign currency showing after the transaction POSTED, that you could claim it is a DCC.
You would need to wait till posted transaction or statement close, in order to see the foreign currency billed. Only when no foreign currency showing after the transaction POSTED, that you could claim it is a DCC.
Mar 26, 2015 | 1:00 am
#1797
Join Date: Mar 2015
Location: Las Vegas
Programs: United Platinum, IHG Spire Ambassador, Hilton Diamond
Posts: 291
Pending is always in native currency - this is true for almost all banks' cards I have - AMEX, Citi, Chase, Barclays and BofA. However once transactions are POSTED, you can then click on the line and open up the description where you will see the foreign currency. Some banks wouldn't show it until statement. I dont remember the nuisance of each bank.
You would need to wait till posted transaction or statement close, in order to see the foreign currency billed. Only when no foreign currency showing after the transaction POSTED, that you could claim it is a DCC.
You would need to wait till posted transaction or statement close, in order to see the foreign currency billed. Only when no foreign currency showing after the transaction POSTED, that you could claim it is a DCC.
Mar 26, 2015 | 8:17 am
#1798
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
As soon as it posts I'll post it here. You're right, I've never seen a transaction still pending with an exchange rate posted. However, I have a feeling it will be this exact amount as a native USD transaction though, considering the amount listed on my receipt in USD and the amount of the pending charge in USD is exactly the same, and nowhere the real exchange rate.
Mar 26, 2015 | 8:29 am
#1799
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
If it turns out to be DCC you could still try to file a Reason Code 4846 chargeback with Citibank. You could claim that you were not given the option of paying in local currency (notice that the IDR charges were 'declined'), that they did not disclose the exchange rate, and that they did not advertise they were applying their own non-MasterCard exchange rate.
Mar 26, 2015 | 8:44 am
#1800
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
It's no different than a paper receipt where the merchant selects for you (against your wishes). The only disadvantage here is that you can't completely deface the receipt stating that a local option wasn't offered.