I'm thinking Visa and MC give a reasonable conversion rate, and earn a reasonable 1% on top of that.

Let's be honest here, no one can convert currencies for free, right? If you go to a bank to convert, it's gonna be much higher than 1%.

And, some CCs are eating up that 1%, so we have the best deal in oversee spending.

1% is reasonable, but DCC's markup of the typical 3-5% is not.

I think the underlying core is whether the fees are justified or not. With actual in-person based currency exchanges, the fees you can make sense of because of the need to recover labor cost, rent for the store space, non-real time currency exchange rates, the risks involved with security, as well as the cost to bring in and store foreign currencies.

But with credit cards, everything is electronic and in real time these days so there really is no justification for such high fees.

There are still opportunities for arbitrage, and you have to find a willing buyer/seller for the currency. I contend that there is still overhead with currency conversion, but DCC is a pure profit grab from the merchants and acquirers.

Most banking fees have little, if anything, to do with the cost of providing the service. They are set based on what the market will bear.

The same is often true in other industries as well.

In this case, it's largely due to consumer ignorance of or indifference toward the better options that may be available.

Exactly. However, if you go to a Travelex, 3% to 5% is what you expect to see.

I am shocked people still go to those places to exchange money...

That's why it's only 1%, which is really not so high. Even the UnionPay, which boasts non FTF, charges around 0.5% implicitly in their distorted exchange rates.

My opinion is "not looking like much doesn't mean there isn't". Let's face it, most banks do business online as well, but can you get the interbank rate with them if you exchange money using their online banking?

I've really not seen any rates better than Visa/MC rates.

Kudos.

I think DCC is comparable to money exchange booths, in terms of markup percentage. This way they think they have some justifications...

Only savvy travelers know how to use no FTF Visa/MC debit cards to withdraw money oversees to get the best rates, and only savvy travelers know how to use no FTF CCs (while avoiding DCC) to get the most rewarding oversees spending as well. We care about how to beat the game.

Those who don't know, will just contribute to DCC/money exchange market. The fact that there are these don't knowers, is no shocking to me at all...

DCC Policy for Accor Hotels?
 

Has anyone had any recent experience with Accor Hotels, particularly Novotel? I reserved a room next week Thursday at the Taoyuan Novotel, and I don't trust the pricing information that the website gives. The website says that the pricing information (defaults to USD) is for informational purposes only and that the charges would be billed based on the hotel's local currency. However, I know that this particular hotel offers the option of DCC, so I didn't want to get snared with DCC by prepaying the room. (I usually don't do prepaid rooms anyway since the flexibility is nice.)

My strategy here was to book the fully flexible room rate and use an AmEx Platinum (no FTF fee/possibility of DCC) to guarantee the reservation. Upon check-in I'll again use the AmEx Platinum for the room authorization hold. When I check out, I'll use my Chase Sapphire Preferred and request local currency. Thoughts on this process? Am I being overly paranoid? :D

Not all Accor hotels require card hold - French ones don't for instance.

However British ones do. I remember using my AE to hold, and asking them if I can check out with a MC (which had a promo at the time). The receptionist said fine, AE not charged at the time, and charged my stay to the MC on checkout. No charge on AE.

The Taoyuan Novotel has required a hold upon check-in every time I've stayed there. They did it in USD on my Chase card last time - the first time I had become hyper aware of DCC. They assured me that it was only an authorization hold and would fall off of my card without being charged, which it did. I'll probably follow your lead and present the Visa at checkout but use AE upon check-in for the hold.

DCC in Indonesia
 

I always thought Indonesia can't have DCC cos the BNI didn't allow it.

However I got the first quote slip today (a 3.2% scalp to the idr/hkd oanda rate), even though even by the merchant slip there was no verbage. Nor on the cardholder slip.

So I assume a Bangkok-style DCC system is in place here - I don't mind that.

I assume the cashier made an idr input for me or the default is to idr.

Nothing more effective to wake me up from a 5:30 start on a Sunday morning.

I know what you mean there. Whenever I see the DCC language I get a surge of adrenaline. So this system was the quote checkbox like in Taiwan?

For the other times I was asked if I wanted to pay in USD, which I declined and asked to pay in GBP. No pushback except for the 2 referenced earlier. I need to check my card statement to ensure no unexpected issues, but everything seemed to go fine.

http://www.hongkongcard.com/webedito...5436_44946.jpg

http://www.hongkongcard.com/webedito...5250_95186.jpg

No other encounters with DCC.

First report in Taiwan...

We arrived late Thursday evening at around 11pm local time to the Taoyuan Novotel. I noticed a number of folios at check-in, and they all did DCC on the room authorization hold of the equivalent of 7000 NTD in USD with the [X] box checked. Knowing from experience that they automatically select DCC here for the authorization hold, I used my AmEx Platinum as planned. I noticed two things on the receipt:

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

The first is that (S) indicates that the card was swiped, not an EMV transaction? I was too tired to notice whether or not the receptionist swiped the card. The second is the transaction type says "PREAUTH". I assume the DCC rules and choices still apply for this transaction type, but the receptionists at this hotel have always told me in the past that DCC doesn't matter in this case because it's a hold only. However, in the case this charge were to post, it would be a transaction with DCC applied.

I used my Chase Sapphire Preferred at checkout and requested to be billed in NTD:

http://i.imgur.com/5kGND3mm.jpg

This time the receptionist did an EMV transaction, and you can see (C) after the card number. (I've redacted all but the last four digits, my name, and authorization code.) Since I had indicated I wanted NTD, the receptionist had already printed out the above receipt and handed me the quote/signature slip to sign plus the above receipt in tandem. To cover my bases, I still checked the [X] NTD box before signing.

A couple of things to note here. First, Chase is showing a pending transaction in the amount of 192.03, the DCC rate. I think the above receipt indicates that I am in fact safe from DCC even though the pending transaction is the DCC amount, right? It's just like a car rental or hotel authorization hold might be higher than the final posted charge.

Finally, there is a nice 4.8% DCC fee markup on the exchange rate. It makes you wonder how many people fall for DCC without realizing it. :td:

EDIT: I just noticed that the pending charge is for "Novotel Hotels DCC". It's even in the title!