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 merchant’s 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]
Jun 23, 2014, 9:42 pm
#571
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 19,773
Besides, most HK Unionpay cards are dual currency so there is no translation - cardholders have a RMB account in HK where they can settle in RMB.
However it's a matter of choice. What if I would like to enjoy a HSBC promo on its Visa/MCs for HK$1/mile on foreign spending (roughly a 10% rebate)? Can't do it if DCC.
Jun 23, 2014, 10:25 pm
#572
Join Date: Jul 2006
Location: LAX
Programs: AA EXP 1.5MM, Asiana Club Silver, KE Morning Calm, Hyatt Platinum, Amtrak Select
Posts: 7,161
I think this is true. I believe you and I are about the same age (I'm 31), and I know a lot of people our age with a similar mentality. We are always interested in having the most amount of information possible and getting the best deal. Contrast this with my parents (Baby Boomers) who do little to optimize given situations. I've tried to help them with their credit card portfolio, getting Global Entry, using T-Mobile to get international data, etc. but they don't seem interested. You and I would be far more likely to consult with wikitravel before going to a new place, look up the currency and some basic information, find out the exchange rate, and use our 0% ATM cards to get cash and 0% FTF EMV credit cards (avoiding DCC the whole way, of course 
).
).Ever watched the video The Decade You Were Born? Fascinating stuff on what we as those born in the 1980s share in common, as probably do others born in other decades.
What we share in common is that:
1. We grew up in an generation of extremely diverse cultures and ethnicity; not uncommon to find a classroom full of minorities from all over the world, some you ended up becoming best friends with. Hence we're more open to different ideas and trying out new things than previous generations.
2. We grew up in a wide variety of stimulation never seen in previous generations, from the old TV, cassette tapes, VCRs, MTV, video games, comic books, renting Blockbuster video...all the way to live streaming on the internet via Hulu and Netflix of today. We did it all, from the first age of Napster and mp3 downloads to downloading fansubbed anime off of bittorrent.
3. Playing video games actually helped us get used to upcoming technology and became naturally curious about the world (ooh, let's try to find all the secret places in The Legend of Zelda or break all the bricks in Super Mario Bros.)
4. We're the last "youngest" generation to see and somewhat sort of remember what the world used to be like in the age before cell phones and the internet. We grew up memorizing our friends' phone numbers in a push button phone, we grew up watching old NTSC VHF/UHF color TV and analog cable, we entered adulthood with that incessant Nokia ringtone and "Google" becoming part of the Oxford dictionary.
Last edited by kebosabi; Jun 23, 2014 at 10:34 pm
Jun 24, 2014, 12:35 am
#573
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
Actually we don't lose the 0.3%-0.5% (Unionpay wholesale rate markup?) - most HK Unionpay cards are Foreign Currency Translation fee-free whereas all HK Visa/MC pass the Visa/MC 1% (without seperate disclosure).
Besides, most HK Unionpay cards are dual currency so there is no translation - cardholders have a RMB account in HK where they can settle in RMB.
Besides, most HK Unionpay cards are dual currency so there is no translation - cardholders have a RMB account in HK where they can settle in RMB.
I do feel that Unionpay has a markup about 0.5% on rates. It is close to what major banks charge for rate markups.
So these dual currency cards in HK, they have a Unionpay RMB account, and a Visa/MC HKD account?
Jun 24, 2014, 12:57 am
#574
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 19,773
Chase eats the 1% on CSP right?
Not for V/MC - even the most aggressive V/MC passes the 1% along but simply adds no mroe.
Unionpay only - no Visa/MC on those cards
Two accounts - one RMB (usable only within the PRC) and HKD (usable outside PRC including HK)
Not for V/MC - even the most aggressive V/MC passes the 1% along but simply adds no mroe.
Two accounts - one RMB (usable only within the PRC) and HKD (usable outside PRC including HK)
Jun 24, 2014, 1:05 am
#575
Ambassador, Hong Kong and Macau
Join Date: May 2009
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4. We're the last "youngest" generation to see and somewhat sort of remember what the world used to be like in the age before cell phones and the internet. We grew up memorizing our friends' phone numbers in a push button phone, we grew up watching old NTSC VHF/UHF color TV and analog cable, we entered adulthood with that incessant Nokia ringtone and "Google" becoming part of the Oxford dictionary.
We do trips we wouldn't dream of ten years ago even if we had the financial wherewithal.
We are far more comfortable now than ten years ago travelling outside of a tour group (HKers used to stick to agency tour groups like the group that was shot up in Manila). We can research transport and places to go in advance and on the fly. We Google Map every taxi ride. And if someone doesn't speak English (or Mandarin) we use Google Translate.
Jun 24, 2014, 9:04 am
#576
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Jun 24, 2014, 9:34 am
#577
Join Date: Jul 2006
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In contrast, the Millennial generation share the common trait of being scrapped with money due student debt and poor job market, have literally a sea full of information at their fingertips that enables them to find the best bang for the buck. We need to stretch our dollar to the fullest. The ultra-low end backpacker market and trendy/hipster type youth hostels has grown a lot in the past decade ever since the internet changed the way we see travel. It used to be sharing notebooks and word of mouth, now it's sharing travel blogs and reading hostelworld reviews. "Paying" for stuff using rewards earning credit cards is a must have. Being connected to the internet for constant info and social media is like an addiction for our generation.
Last edited by kebosabi; Jun 24, 2014 at 9:40 am
Jun 24, 2014, 9:57 am
#578
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My parents are of a similar mentality and will pay for the organized tour like Tauck or cruise ship like Holland America but don't much care for foreign independent travel unless it's an English speaking country or a Western European country that sees a lot of foreign tourists. (It was like pulling teeth getting them to Taiwan in December 2012 to meet the in-laws.
) I think these types are far more susceptible to DCC and just want as much familiarity as possible even while traveling abroad.
Jun 24, 2014, 10:18 am
#579
Join Date: Jul 2006
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Everywhere they went, they ended up staying at a major American hotel chain like Hilton, eating at McDonalds or a family restaurant, going to a plain old department store for some shopping of "boring" items (as he said), maybe a little Buddhist temple or Shinto shrine but not staying there for length of time to understand or feel the zen that goes along with it, and mostly travel by hired taxis.
"Why would they spend money to come all the way to Japan only to eat a Big Mac at McDonalds and not at least once try real Japanese food?" he would say.
He ended up going back to Japan several years later and stayed there for two months doing what he could never do with his parents around: actually experience Japan from staying at onsen ryokan, eating Japanese food, shopping for anime goods at Akihabara, and travel by train and bus.
Jun 24, 2014, 10:22 am
#580
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Yes, here card issuers eat the 1%. They used to build it into the rate where it would get muddled but there was a lawsuit that (largely?) put a stop to this. For instance, if I use a Chase card with a 0% FTF or withdraw money from my Fidelity cash management account at 0% FTF, I know the amount on the posting date matches the Visa exchange rate calculator exactly. It definitely beats the 3% FTF common a few years ago and $5 + 3% withdrawals at a foreign ATM.
We do have a near equivalent of a 0% card - Fubon Bank here charges 1.85% Foreign Currency Conversion Fee and no FTF and rebates points that can be converted for HK$100 cash rebate per $5,000 foreign spend, or 2%. Of course this means you get rounded down to nearest $5,000 every points expiry, which this bank aggressively does every year.
Jun 24, 2014, 10:40 am
#581
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For the most part, I think this transcends many Baby Boomer generations across all cultures. Baby Boomers are relatively financially stable. Japanese Baby Boomers tend to go with organized groups like HIS, Kintetsu and JTB, American Baby Boomers go with Celebrity Cruises or look at AAA and AARP travel catalogs. A common trait of Baby Boomers is "I don't want to figure stuff out, I'd rather pay money and let the travel agency do all the thinking for me." My 67 year old aunt in Japan is similar in naiveness to many American Baby Boomer travelers as JEFFJAGUAR mentioned, "I don't mind paying for DCC in Hawaii because I know what the charge is in JPY" and trying to dissuade her not to do so is useless.
OK, maybe my mother is a more world-wise baby boomer than yours. But still an old fashioned one.
She still has a stack of greenbacks hidden under the bed - I recently took them out cos we're finally going to places where they are really accepted (Cambodia and Guam) and found some notes still bear the signature of Robert Rubin (I took them out and banked them into my USD account).
She doesn't ATM - either her messenger walks a cash withdrawal slip to her bank (and by standing arrangement her bank manager will accept such slips up to about US$10K) or her bank manager walks with his cash float to her office (in hongkongcard.com this was called "walking ATM").
And if she needs foreign banknotes (not travelling with me) her bank manager does the conversion and passes the foreign banknotes to her in the same way as her HK$ cash <-- always at the bank rate but for non-trade currencies like THB and KRW I find the rates can be off as much as 10%.
Ancient right?
I recently spotted she's been DCCed in Bangkok. I didn't go. From personal experience I know she was most likely given a quote slip and accepted it. Perhaps she compared it with the marked-up rate her bank gave her and thought its a good deal. Yes she has Yahoo Finance on her smartphone and a roaming connection but I have no luck getting her to look at anything but her stock and bonds portfolio (no luck getting her to add currencies on her own).
On the other hand when I told one of her friends (as a proxy of her - I paid for her) that their Dongguan Golf Club wanted to charge HK$1.265/RMB (compared to HK$1.2325/RMB HKAB rate) the sales manager nearly lost his head.
Last edited by percysmith; Jun 25, 2014 at 12:59 am
Jun 24, 2014, 11:04 am
#582
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I have at least trained my mom to always ask for "local currency". However, I don't think she will be a stubborn as those of us on the forum to ascertain that she's actually been charged in the local currency. My parents don't carry smartphones (even though they pay for a data plan with Verizon Wireless 
). They refuse to allow me to lend them a phone overseas or help them acquire a local SIM card. They never use an ATM, and they don't check any accounts online. I think I have more of a fighting chance getting DCC disabled at a Global Payments terminal in China than convincing my parents that their ways are outdated.
). They refuse to allow me to lend them a phone overseas or help them acquire a local SIM card. They never use an ATM, and they don't check any accounts online. I think I have more of a fighting chance getting DCC disabled at a Global Payments terminal in China than convincing my parents that their ways are outdated.
Jun 24, 2014, 11:52 am
#583
Join Date: Jul 2006
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Flash-forward several decades from now, our grandchildren will be looking at us how ancient we are because we still use online billpay when they are doing things telepathically. And we'll be saying "you little whippersnappers are so lazy you don't even want to use your fingers!" LOL
As for my mom, it took a while for her to deposit checks and cash at the ATM. She still buys things with her debit card rather than chasing after points and miles. Very unitask, she has an US issued JCB card, her only use is to use it at Japanese grocery stores and while in travel in Japan, but is generally not interested in collecting JCB cash back points by using them wherever Discover is accepted.
Jun 24, 2014, 12:08 pm
#584
Join Date: Jul 2010
Location: YYZ
Posts: 1,666
Great discussion in these last few posts.
My parents kept on making this mistake through their European cruise vacation and at transit points/short trips in Asia as well. They always assumed that converting back to the home currency = saving money, and even after I repeatedly warned them to ask for "local currency", they still keep on doing it by reflex.
Even more ridiculous is how using a Canadian credit/ATM card, I'm offered DCC in USD sometimes (quite notably, Credit Suisse offered USD DCC for a Canadian card at their ATMs) at exorbitant rates, and I would have to pay the 2.5% on top to convert USD to CAD. And yet, I've had friends fall for this many times as they assume converting to USD first saves them money as opposed to CHF-CAD direct.
I hate to think how many people DCC has fooled - such an easy way to make money off unsuspecting tourists/visitors. Almost every time I've seen others face DCC at checkout lines when using foreign cards (in Japan, Korea, Singapore, Taiwan etc.) that person has always chosen to be charged in their home currency. It's just slimy how the entire thing is marketed and presented by merchants (I fell victim to RyanAir once, as they auto-DCCed my transaction once I entered my credit card number with a small line of text that appeared.)
At least my parents have gotten with the times a few years ago, where they started putting everything on their credit cards to collect cash back/points.
My parents kept on making this mistake through their European cruise vacation and at transit points/short trips in Asia as well. They always assumed that converting back to the home currency = saving money, and even after I repeatedly warned them to ask for "local currency", they still keep on doing it by reflex.
Even more ridiculous is how using a Canadian credit/ATM card, I'm offered DCC in USD sometimes (quite notably, Credit Suisse offered USD DCC for a Canadian card at their ATMs) at exorbitant rates, and I would have to pay the 2.5% on top to convert USD to CAD. And yet, I've had friends fall for this many times as they assume converting to USD first saves them money as opposed to CHF-CAD direct.
I hate to think how many people DCC has fooled - such an easy way to make money off unsuspecting tourists/visitors. Almost every time I've seen others face DCC at checkout lines when using foreign cards (in Japan, Korea, Singapore, Taiwan etc.) that person has always chosen to be charged in their home currency. It's just slimy how the entire thing is marketed and presented by merchants (I fell victim to RyanAir once, as they auto-DCCed my transaction once I entered my credit card number with a small line of text that appeared.)
At least my parents have gotten with the times a few years ago, where they started putting everything on their credit cards to collect cash back/points.
Jun 24, 2014, 1:26 pm
#585
Join Date: Jul 2006
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The Baby Boomers, as they retire, will travel more. It's the perfect business model: make money off the wealthiest generation and give them what they want and charge a price for it. And walla, you have the DCC scheme. And a vast majority of Baby Boomers wouldn't see this as a scam, but more as a service.
It ends up sucking for Millennial travelers because we're the generation that's most likely to research all the options beforehand. We know there's no such thing as service these days without a price. We're called the generation with high BS meters. Tripadvisor, wikitravel, Wikipedia, Google, are our tools. It doesn't come that hard for us to come up with the details of the DCC scheme. Hence, we're likely to see DCC more as a scam than service.
And when it comes to Millennials trying to teach Baby Boomers, well we already have several examples of it ending up in vain right here. It's always going to end up being a "but Dad/Mom, you're getting ripped off!" vs "meh, I don't care/not willing to change etc. etc." and it's going to be a hard time doing so.