Don't worry. With POS that has DCC function, the hold amount is usually the DCC amount, when DCC is actually turned off. This will turn out to be fine when it is posted.

If yours situation is not like the one mentioned above, we will see a world's first...

Regarding the PREAUTH, I assume they never bother to choose the right currency for the hold, and they always choose to run another sale transaction instead of using the proper way of COMPLETE AUTH.

Agree. This is like my Maldives DCC case which was posted properly in USD in the end.

Yeah, I remember the Maldives case. I guess I didn't encounter this preauthorization situation with the two times I encountered DCC most recently in Australia because there they don't generate the quote slip beforehand. If the DCC verbiage prints on the receipt, it's too late. I believe this is how it's done with most terminals in the mainland too? That is to say... once you've seen a pending transaction with the DCC amount, you've likely been hit.

I think the ideas got mixed up in your above statement...

First, if the DCC verbiage is printed, then it means you've been already hit by DCC, no matter whether you have boxes to tick on the slip... Yes, this is how it is done in the Mainland.

Second, if the DCC amount is pending, that does NOT mean anything dangerous. It is just how these DCC-enabled machine do transactions. They hold the DCC amount no matter what, and post the DCC/non-DCC amount based on whether you've dodged DCC.

Third, if the DCC is used on PREAUTH, simply request them to run another sales transaction without DCC, and cancel the PREAUTH, instead of completing it. I do think if the PREAUTH is DCCed, one cannot turn it off when completing it.

Interesting. The two times I encountered DCC in Australia in June the pending transaction amount with Chase was the non-DCC amount. I understand that I may not have been hit with DCC even if the pending transaction is the DCC amount.

Finally, I wasn't aware that a PREAUTH transaction with DCC cannot be converted to a non-DCC transaction later. This is why I used the AmEx for the authorization hold at the Novotel, just in case.

Come to think about it, I might be wrong in the PREAUTH thing. There has been instances that I got PREAUTH in CNY, but got USD "DCC COMPLETE"... So these two might not need to have the same currency used.

But for the pending amount, I've seen so many times in China that I got DCC (or 3% higher than normal USD amount) amount pending, but the posting amount was right. I guess the pending amount is determined by the POS firmware, and some DCC machine hold the DCC amount no matter what.

We went to moondog's ABC place. And also BoC place. We managed to fix the BoC but couldn't get to work on the ABC place. I'll recount the latter first.

ABC shop

Me: (picking up a can of soda water, moondog picks a bottle of vitamin water) "they take visa for this? If we tried this in hk we'd be told off!"
Moondog: "it doesn't cost them! They take it even for one bottle."
(We walk the can and bottle to pay. They are RMB10. Moondog hands over his Visa card.)
Cashier points to visa hologram: "this one? We're no longer accepting this"
Me: (to moondog) "you know her? She knows about the DCC problem?"
Moondog: "yeah I'm buying stuff from her every week!"
Me: (to cashier) "why?"
Cashier: "cos a. we have to pay fee for visa and b. your friend over there told me off for crap exchange rate!"
Me: (to moondog) "so she does know you!"
Me: (to cashier) (showing BoC exchange rate shot below) "so is there any similar screen in your ABC terminal?"
Cashier looks at my photo: "No. No such display"
Me: "tell you what" (handing over my HSBC visa). "Swipe this, cancel this straight after and I will cash you out"
Cashier: "what do you mean?"
Me: "well, after you charged this visa rmb10, can you void it?"
Cashier: "no, I don't know how to void."
Me: (to moondog) "I think the experiment has to stop here. She's not as comfortable as the BoC guy with us mucking around the terminal, and if she doesn't know how to void then she has to pay the fee even if we're fine paying inflated rates on RMB10"
(We paid RMB10 in cash and left)

With the several posts on reauthorisation I suspect a clarification is in order. A reauthorisation is NOT a chargeable transaction and has precisely zero financial impact. Only the final charge is a financial transaction. DCC, if applied, applies to the actual charge, not the reauthorisation. That is true whatever a print may say, just as long as it is clear that the question is 'authorisation' not a charge. Card systems do not match the reauthorisation to the actual charge in any finical way at all, in fact most preauthorisations are for a much higher amount (as in hotel preauths that include all expected charges and an estimate of large additions charges, car rentals that include a collision deductible in preach) than is the actual charge. The DCC selection is applied to the end transaction only; even though the merchant may include it in the prauth that has no transactional effect.

Many merchant employees and most customers are not aware of the significance of a preach. Under no circumstances can a preauth produce a charge. The systems are referred to as "two channel" partly because of that, with the function of preach being to confirm the existence of the account and available credit. The preauth drops off automatically if no transaction arrives, and if a transaction arrives with the preach reference. The reference proves the merchant verified the card and the availability of credit, but the amount submitted can be almost anything higher lower or even the same as the preauth. The systems do not check for amount matching between the two at all.

The hold, of course, happens in the currency in which the account is denominated and has nothing to do with the transaction currency, so DCC or no is not actually a factor. The "right" currency for a hold is the currency of record for the account, not the merchants currency.

The "complete auth" does not exist. Authorisations are NOT sale transactions, they are account verifications. So, a sale transaction must be made or the authorisation simply expires. The sale transaction generally refers to the authorisation in oder to prove the merchant did verify the availability and legitimacy of the account, but the auth has nothing whatsoever to do with the actual sale other than verification. The authorisation is completed by the issuing bank confirming that then account is in good order. That is all it is.

BoC Slip

Alright, the BoC shop we managed to fix. Photos took me forever to clean up. The owner of the merchant asserted he did not ask for DCC to be installed, does not profit-share from DCC or receive a reduction in fees, and will very much like us to get rid of DCC because he is sick of handling DCC complaints:

Bad slip (cashier performs normal procedures):

http://www.hongkongcard.com/webedito...3125_42423.jpg

http://www.hongkongcard.com/webedito...3133_30733.jpg

http://www.hongkongcard.com/webedito...3141_62300.jpg

http://www.hongkongcard.com/webedito...3147_29725.jpg

(this screen only displays for three seconds)

http://www.hongkongcard.com/webedito...3209_34353.jpg

http://www.hongkongcard.com/webedito...3219_47747.jpg

Good slip:

http://www.hongkongcard.com/webedito...3242_99479.jpg

http://www.hongkongcard.com/webedito...3256_93315.jpg

http://www.hongkongcard.com/webedito...3303_87925.jpg

*** must press cancel within three seconds of this screen appearing ***

http://www.hongkongcard.com/webedito...3412_98601.jpg

(press Enter)

http://www.hongkongcard.com/webedito...3436_90854.jpg

http://www.hongkongcard.com/webedito...3448_88516.jpg

Free of verbage.

The three second wait in the ENQUIRE screen before opting-in cardholders is blatantly non-compliant - cashiers shouldn't be made to play wack-a-mole to opt foreign cardholders out of DCC.

BoC really seems to be immune from consequential action by Visa/Mastercard International. It effectively has a come beat me silly if you dare sign up for years and it still can take Visas and Mastercards. Probably any bank from a smaller country like Taiwan or Vietnam will have its central bank directed to discpline the bank directly, but CPG probably does the opposite and encourages DCC growth.

But I'm actually surprised BoC even included such an enquiry. My last up-close of a BoC DCC terminal did not, but that one was not tethered to this base. The one we saw tonight was not detachable. I wonder do detachable ones have pre-loaded rates or something?

I know by posting, I run the risk that BoC will plug the gap. However I hope some visitors to China will be able to opt out such an aggressive DCC terminal before BoC finds this post and updates the firmware. If that happens I have the consolation prize that I forced BoC to spend money fixing its DCC terminals anyway.

Thanks jbcarioca. I have a question though. A preauthorization is meant to ensure customer X is good to pay $Y amount of money by making sure he can't use his credit for other payments.

I've a question concerning merchants preauthorizing amounts close to my credit limit and then trying to authrorize those amounts. Would they be unable to because my credit limit's all used up? Would they have to call Visa to try and get the preauthorizations removed?

I read there's a Preauthorization Payments Cancellation Service that does this http://usa.visa.com/download/merchan...n.pdf#page=381 - is that the function merchants should use under the above circumstances?

Thanks so much for the information. So this will work for any BoC terminal in the Mainland? What about in HK or Macau?

When I encountered DCC at the coffee shop in Brisbane there was a similar prompt with an ANZ terminal, but I didn't remember there being a 3-second window in which to decline DCC before it opted the customer in. The only reason I had access to the terminal at that point was because the cashier thought I was going to enter my PIN. The language on the ANZ terminal was more ambiguous than this. It only had something to the effect of "RATE xxxxxxxxxx \ USD ACCEPT?" An unsuspecting tourist or naive cashier would just keep pressing OK.

You said the store no longer takes Visas because of DCC complaints. I assume it's more than just you and moondog lodging those complaints? :D

At any rate, I imagine the checkbox receipt like that would be a rock solid case in the event of an actual chargeback, right?

The checkbox is, indeed, a solid case against the DCC amount, but IME even when filing chargebacks, credit card issues would prefer to simply credit accounts for the difference... they even prefer to take your word for the amount in dispute than do research of their own for discrepancies under ~$10.

This is the unfortunate aspect of DCC. I would say smaller purchases are more likely to get hit with DCC without a way to opt out. Hotels, department stores, etc. usually have a way to disable DCC without too much hassle and there's almost always an opportunity to at the very least deface the receipt. With small purchases there might be no verification required. I don't really care as long as I'm not out the money, but you have to wonder when issuers will say, "Enough is enough!" and start filing chargebacks.