Jan 18, 14, 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]
Jan 20, 14, 9:59 am
#31
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 5,697
HK used to be far better than China (i.e. mandatory DCC was rare), but I've noticed that it is starting to spread there at an alarming rate as well, which I suppose shouldn't be too surprising because many Chinese acquirers also operate in HK.
In the China forum thread, we've posted DCC workarounds for several popular POS machines. The problem is they are continuing to "innovate" faster than us.
In the China forum thread, we've posted DCC workarounds for several popular POS machines. The problem is they are continuing to "innovate" faster than us.
What happens if you refuse to sign the charge slip? It seems as though most people have been successful getting the charges voided, but it doesn't help end this practice if you end up paying cash. Furthermore, if you're with a group of friends, they'll think you're creating a scene and being petty over something immaterial.
Jan 20, 14, 10:03 am
#32
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: FQTR CX FTQS JL FQTV TBD
Posts: 18,953
I have experience with DCC outside of China and whilst I've encountered aggressive DCC behaviour, no country is so badly policed as the PRC in terms of DCC. Taiwan had a period of non-opt out DCC for a while in 2011 but someone stepped in and they're all good now.
Jan 20, 14, 10:09 am
#33
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: FQTR CX FTQS JL FQTV TBD
Posts: 18,953
http://www.flyertalk.com/forum/china...l#post16908166
http://www.bloomberg.com/news/2013-0...cy-policy.html
I don't get it. Is the objective of antitrust law to give choice even if the alternatives are shown to be almost certainly worse?
Furthermore there's no real choice under a lot of circumstances - you get two, or one.
I'm not sure mc/visa had much choice in this. After all, they make substantial income on the 1% they charge for currency exchange transaction and I believe it's 0.8% or something for allowing acces to the international interchange system even if no currency exchange is involve.d.
As far as I understand MC has the 0.8% foreign transaction fee and Visa doesn't. Really adds insult upon injury for DCC transactions on MC.
Jan 20, 14, 10:22 am
#34
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: FQTR CX FTQS JL FQTV TBD
Posts: 18,953
I've long held a theory that the Chinese Government creates very favourable conditions for DCC scamming:
- They own the local competing payment system - Unionpay - and majority stakes in most major Chinese banks too.
- They are really pushing to promote local brands - they're also doing this to the Big4 Global Accounting Firms (despite almost all the partners being HK/Mainland Chinese) http://app1.hkicpa.org.hk/APLUS/1006...20-24_Big4.pdf
- They hate Visa quite a lot, given Visa's intransigence over PRC-issued dual-coded Visa/Unionpay outside China (Visa ruled that all Visa merchants outside China must use the Visa function of the dual-coded cards). Dunno what's their attitude towards MC.
The CBRC won't bat an eyelid towards systematic DCC rort and won't police its banks to follow Visa's/MC's rules. Most banks will be allowed to tell Visa/MC - I'm gonna scam all your customers. You can pull my entire participation in Visanet if you wish but if you don't then you play by my rules.
In any case I also see this as generally China's increasing unfriendliness towards foreigners - another being the post-1 July 2013 visa restrictions. As FIEs we're finding it harder to increase investment into China too.
Last edited by percysmith; Jan 21, 14 at 3:54 am
Jan 20, 14, 10:37 am
#35
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: FQTR CX FTQS JL FQTV TBD
Posts: 18,953
What happens if you refuse to sign the charge slip? It seems as though most people have been successful getting the charges voided, but it doesn't help end this practice if you end up paying cash. Furthermore, if you're with a group of friends, they'll think you're creating a scene and being petty over something immaterial.
OK, just a short explanation on my circumstances
- I live in HK and have permanent residency. This means I've access to RMB/HKD denominated Unionpay cards and RMB accounts to settle them with. I can draw cash out of RMB ATMs in HK and recently I can even put them back in again.
- I have family in Australia and in any case since I'm based in HK, my travel is mainly redemption travel with CX and its OW partners and my primary miles program is Asia Miles (though I recently added Avios for better short-haul redemptions inside Asia).
Most of my miles are from credit card spend. HK is a haven for earning miles with credit cards and I try to maximise earning from card spending for everything I have to pay.
This may result in me paying with Visa in China instead of taking the more convenient option of paying with Unionpay e.g. Unionpay cards earn RMB4/mile, but a Visa card on a promo may earn HK$1.11/mile. Of course the promos usually state the promo must be free of DCC i.e. the HK bank must earn its 1.95% foreign curerency translation fee.
But really using Visa in China is increasingly frustrating. I think for 2012 Christmas I've spent a full day in Shenzhen dining, wining and shopping without being able to pay Visa or alternatively being able to pay for it without DCC.
I tried studying and disarming card terminals, but I'm not convinced Chinese banks really have to let us opt out given the lack of policing and policy encouragement to DCC. Normally when I see DCC language my SOP is to:
- void the slip, even if it takes me 30 minutes to do so
- (really haven't done this yet) tick the merchant slip, photo the slip and dispute it
I've done a full chargeback before. But I'm finding there are fewer Visa promos applicable in China and the marchants to use them on for me to use Visa in the face of DCC.
Last edited by percysmith; Jan 21, 14 at 3:55 am
Jan 20, 14, 10:47 am
#36
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Taiwan had a period of non-opt out DCC for a while in 2011 but someone stepped in and they're all good now.
All other places are either TWD exclusively or process the transaction correctly up front when I hand them my card. Usually when shopping in department stores I just tell my wife to have them charge in TWD.
Jan 20, 14, 10:49 am
#37
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Perhaps I'll do a quick summary of DCC behaviour outside China:
Taiwan and Thailand: a quote slip is generated, the terminal pauses, you tell the cashier whether to press yes or no into the terminal. If yes a DCC slip with confirmation box gets generated. If not, a DCC-free slip gets generated.
Japan: DCC virtually unheard of, but recently started with full choice given.
UK and France: appears electronically on the POS system. Cashier makes input yes or no. Sometimes they forget to ask but the POS cannot void/refund in your currency (thus locking in the profits).
Korea: akin to UK/France. Except the slip's in Korean so sometimes difficult to figure out whether you've been DCCed (or whether you even got back the card slip!).
Italy/Spain - on signature pad if signature is captured there.
Vietnam: not seen...(?)
Indonesia: illegal due to central bank restrictions (card charges must be in IDR).
Cambodia: used my USD card (see below)
Sorry no info on Australia or the US cos I've AUD and USD-denominated cards and some savings in those currencies.
Taiwan and Thailand: a quote slip is generated, the terminal pauses, you tell the cashier whether to press yes or no into the terminal. If yes a DCC slip with confirmation box gets generated. If not, a DCC-free slip gets generated.
Japan: DCC virtually unheard of, but recently started with full choice given.
UK and France: appears electronically on the POS system. Cashier makes input yes or no. Sometimes they forget to ask but the POS cannot void/refund in your currency (thus locking in the profits).
Korea: akin to UK/France. Except the slip's in Korean so sometimes difficult to figure out whether you've been DCCed (or whether you even got back the card slip!).
Italy/Spain - on signature pad if signature is captured there.
Vietnam: not seen...(?)
Indonesia: illegal due to central bank restrictions (card charges must be in IDR).
Cambodia: used my USD card (see below)
Sorry no info on Australia or the US cos I've AUD and USD-denominated cards and some savings in those currencies.
Last edited by percysmith; Jan 20, 14 at 5:05 pm
Jan 20, 14, 11:00 am
#38
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Thanks for the above post. I have yet to be DCC'd in Australia in my 6 trips there over the last 3 years, but I imagine it does happen. I don't much like the credit card surcharge that some places tack on, but at least that's disclosed.
I'll be headed back to Spain in February, and so I'm wondering what the best practice is for there? Should I specify that I want to be charged in euros or refuse to sign if I've been DCC'd? I half expect places that don't do DCC will think I'm crazy for asking them to charge me in euros. "What else would we use? Pesetas?"
I'll be headed back to Spain in February, and so I'm wondering what the best practice is for there? Should I specify that I want to be charged in euros or refuse to sign if I've been DCC'd? I half expect places that don't do DCC will think I'm crazy for asking them to charge me in euros. "What else would we use? Pesetas?"
Jan 20, 14, 4:41 pm
#39
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I'll be headed back to Spain in February, and so I'm wondering what the best practice is for there? Should I specify that I want to be charged in euros or refuse to sign if I've been DCC'd? I half expect places that don't do DCC will think I'm crazy for asking them to charge me in euros. "What else would we use? Pesetas?"
The only time I saw DCC was in El Engles Cortes in Gran Via Madrid, where I saw a 4% DCC rate for a split second before the cashier selected it away on the POS (cos I already said "charge Euros please").
Jan 20, 14, 4:50 pm
#40
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Hi percysmith, thank you for your detailed insights. Could you go into a little more detail about Taiwan? You said there were some issues in 2011, but our trip there in June 2011 didn't yield any DCC transactions. The only place where I've ever had an issue was the Taoyuan Novotel. They insisted on placing the room deposit in USD, but the final charge slip was in TWD. I acquiesced only because it was a room deposit, not an actual charge.
All other places are either TWD exclusively or process the transaction correctly up front when I hand them my card. Usually when shopping in department stores I just tell my wife to have them charge in TWD.
All other places are either TWD exclusively or process the transaction correctly up front when I hand them my card. Usually when shopping in department stores I just tell my wife to have them charge in TWD.
When I was checking into my hotel last December I noticed there was a card-not-present Global Payments deposit slip in HKD in my folio already. I asked and was assured it would not post if I presented alternate payment on check-out, which was the case.
My experience outside hotel was identical to yours - even in Everrich Duty Free. The difference in the cross-strait experience made me think Visa can enforce its rules in Taiwan but not in the PRC.
Jan 20, 14, 5:45 pm
#41
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Besides applying DCC on signed card terminal slips on checkouts, I or my friends have encountered the following:
- DCC on prepaid rate (Amsterdam)
- DCC on express checkout (Shenzhen)
- DCC on prepaid rate (Amsterdam)
- DCC on express checkout (Shenzhen)
Jan 20, 14, 7:08 pm
#42
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I was there last June and December.
When I was checking into my hotel last December I noticed there was a card-not-present Global Payments deposit slip in HKD in my folio already. I asked and was assured it would not post if I presented alternate payment on check-out, which was the case.
My experience outside hotel was identical to yours - even in Everrich Duty Free. The difference in the cross-strait experience made me think Visa can enforce its rules in Taiwan but not in the PRC.
When I was checking into my hotel last December I noticed there was a card-not-present Global Payments deposit slip in HKD in my folio already. I asked and was assured it would not post if I presented alternate payment on check-out, which was the case.
My experience outside hotel was identical to yours - even in Everrich Duty Free. The difference in the cross-strait experience made me think Visa can enforce its rules in Taiwan but not in the PRC.
Outside of hotels places either don't use DCC or have always honored the currency of my choosing (TWD). We will likely be going back sometime in April, so I can report my experiences at the Novotel since we always stay there the night before flying out.
Jan 21, 14, 4:09 am
#43
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Dynamic Currency Conversion (DCC) - Master Thread
My latest ATM in Poland prompted me if I would like a guaranteed exchange rate or an unknown exchange rate. No other information. Quite deceiving.
Jan 21, 14, 6:23 am
#44
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Jan 21, 14, 6:46 am
#45
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To be fair, there have been reports of FX rates moving in such a manner between transaction and settlement in which the DCC rates are actually the better deal. (Of course, this is quite rare and doesn't detract from the overall business case for DCC from the institution's point of view.)
