Jan 18, 2014, 10:10 pm
Last edit by: emilio911
What is it?
Dynamic Currency Conversion (DCC) is a "service" some merchants and ATM operators offer that will charge a cardholder in the native currency of the card rather than the local currency. A more complete definition and examples are available via this Wikipedia article on DCC. While sold as a convenience to cardholders traveling outside of their home country, it is a pure profit play by the merchants. You may end up paying a fee of up to 8% over the purchase price for accepting DCC. Always decline DCC and asked to be billed in the local currency!
Where will I see it?
You can be hit with DCC anywhere there is a difference between your debit or credit card's denominated currency and the currency of the location where you're trying to use the card. The most common example will be at a merchant overseas, but now some ATMs are offering the service too. While many US cardholders complain about getting tricked into accepting DCC overseas, some merchants in the US have started to use DCC as well.
What is the issue?
Unless you're the merchant or ATM operator, there isn't much benefit to using DCC. Some customers say they prefer knowing exactly how much they'll be charged in their home currency or may not know the exchange rate of the place where they are visiting. For example, if you are in Prague for two days and you don't know how much the Czech Koruna is worth relative to the US Dollar, you might feel more comfortable knowing that you're buying an item for $205.00 versus 4000 CZK. However, the real exchange rate as of January 18, 2014 would place 4000 CZK at $197.18. You just paid an extra $7.82 for the "convenience" of knowing how much you'd be charged!
DCC often charges about a 4% premium over the true exchange rate. The problems don't stop there since many US banks still charge a 3% foreign transaction fee (FTF) for purchases made outside of the US. Not only would you get hit with the $205.00 charge, you could also find yourself facing a total charge of $211.15 if your card has a 3% FTF.
This is a pure money grab from the merchants, and it's billed as an easy way to squeeze additional revenue out of the transaction. Numerous [1, 2] articles have talked about DCC duping many consumers. Discover even has a warning about being tricked into DCC when using a card abroad.
For example, this FlyerTalk member reported that Avis charged his Saudi credit card in Saudi riyals instead of USD for a car rental in Florida without his consent. This has also been a trend for hotels, particularly large chains as indicated here and here.
DCC is simply not worth it for the consumer. Unless you like paying a convenience fee of up to 5% of the total transaction just to know how much you will be billed, you should always decline DCC and ask to be billed in local currency when handing over your card.
Furthermore, it is in your interest to obtain a card that has a 0% FTF. FlyerTalk member kebosabi maintains a fairly comprehensive spreadsheet of EMV-enabled cards ideal for overseas travel, many of which offer a low or 0% FTF as a feature. There is also a wiki at FlyerGuide of various FTF of debit and credit cards.
What can I do to avoid DCC?
American Express currently does not support DCC on its network, so you are safe from DCC if using an American Express card. However, Visa and MasterCard card networks can support DCC, so be vigilant when purchasing abroad with a Visa or MasterCard branded card. There have been reports of being charged DCC with a Discover card in China [citation needed], but primarily the issue is happening with Visa and MasterCard cards.
Before handing your card to the merchant, always specify clearly that you want to be charged in the local currency and that you do not want DCC. For some transactions, you retain control of your card as you dip it into a chip reader and can view on a screen to select which currency you want to use for the transaction. Always select the local currencyto get the best exchange rate. Do not select the card's native currency!
Similarly, for ATM withdrawals, make sure you decline any kind of conversions. Some good examples of what to look for when using an ATM overseas are here and here. You're probably coming off of a long flight and fatigued, but educating yourself beforehand can save you from getting ripped off. The user interfaces on almost all of these ATMs are set up to encourage you to take the bait, and you have to be extremely vigilant not to fall for it.
If you are doing a PIN-based transaction, you should have the opportunity to review the total amount and denomination of the transaction before entering your PIN. If you are doing a signature transaction and the merchant has processed your transaction with DCC, cross out the amount and write "DCC refused" on the receipt. Do not sign the receipt, and demand that the merchant reverse the transaction and run it in the local currency. If no verification is required due to a small purchase amount, ask the merchant to reverse the charge and repeat the transaction using local currency. If all else fails, file a dispute with your card issuer when you return home. Even if it's immaterial, the banks will get the message like they did with EMV.
Some merchants will claim that their systems have to bill you in your native currency. This is a complete lie. But just like a mag stripe only card, this is battle where you have to be prepared. Don't settle for merchants claiming that "it has to be done this way" or "pay cash if you don't want this". Be prepared to walk away, and, if you must complete the transaction, write "DCC refused & merchant didn't give a choice" on the receipt and cross out the amount. Let the merchant know that you will be filing a dispute with your bank.
Disabling DCC
Disabling DCC on ANZ terminals in Australia
ANZ markets DCC as Customer Preferred Currency (CPC). Terminal operators can contact ANZ Merchant Services at 1800 039 025 to have this feature disabled. Currently, your Visa or MasterCard will be subjected to DCC if denominated in: CAD, CHF, DKK, EUR, GBP, HKD, JPY, MYR, NOK, NZD, SEK, SGD, THB, USD, or ZAR. All DCC transactions on ANZ will cause a 2.5% markup. Steps to avoid DCC:
If you see a signature slip with DCC verbiage and a checkbox indicating a currency selection, kindly ask the merchant to void the transaction. If it's a PIN-based transaction, you have an additional opportunity to cancel the transaction because it will ask for your PIN a second time. For instance, if you see "EUR 17.29 KEY PIN" refuse to enter your PIN and start again.
Disabling DCC in China
There are many reports of forced DCC in China, and there is a great thread [closed to new posts] on DCC in China on the the China Destinations forum.
Disabling DCC on Bankcomm terminals in Beijing http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #19
jair101's DCC instructions of March 2011 http://www.etveg.com/misc/DCC_China.pdf
Disabling DCC in Eurozone and UK
DCC offered in tourist traps (Harrods Knightsbridge/Galleries Lafayette Montparnesse/El Cortes Ingles Grand Via Madrid)
Unlike the rest of the world, Visa Europe does not require merchants to collect a ticked box on the slip (presumably because merchants there don't keep signed slips under Chip-and-PIN)
El Cortes Ingles collects a signature electronically and the DCC selection is made on the signature pad - the choice is respected.
Harrods and GL rely on cashier input in the POS for the currency choice - the cashier may forget to ask. The POS do not offer voiding (only refunds), but since you're given a slip to sign the best thing to do is to deface it before signing and submit chargeback request to issuer bank on return home.
There may be smaller merchants who also collect DCC but I seemed to have pre-empted most of them by saying "charge Euros (Pounds) please"
In Spain all merchants by law are required to provide you with a complaint form called an hoja de reclamaciones if requested. The form has two carbon copies. The customer retains one copy as a record of the complaint. The merchant maintains another copy, and the third is sent to the local consumer protection bureau. Merchants are also required to post a sign conspicuously informing the customer of the right to complain (usually in Spanish and English). Do not accept the lie that they don't have any forms. This is illegal, and you are able to call the police if the merchant refuses to provide you with this official form. It's interesting to see merchants start to squirm when you know the rules, and most merchants will start to be accommodating after you mention it. (Please still fill out the form even if the merchant cooperates after mentioning it because these are likely the merchants who won't otherwise change their behavior.)
Disabling DCC in Hong Kong and Macau
Hong Kong and Macau can get as non-compliant as China, possibly because many acquirers have cross-border operations and know they can get away with non-compliant firmware and procedures.
In practice, if you are given a DCC slip, and the cashier has not taken a choice before giving you your copy, the slip will be processed in your home currency - be prepared to dispute.
Unable to disable Global Payments DCC in Hong Kong instance #1, instance #2
Unable to disable DBS DCC in Fortress Electronics HK
Unable to disable BoC DCC in Free Duty HK
Disabling DCC in Japan and Korea
Japan's just starting out http://www.flyertalk.com/forum/japan...ing-japan.html and http://www.hongkongcard.com/forum/fo...p?id=3939&p=17 #168 but there are no reports I know of where cardholders are compelled to use DCC against their will.
Korea is also not much affected by DCC but where offered, trying to opt out is harder than Japan due to the language barrier (both verbal and written)
http://www.hongkongcard.com/forum/fo...hp?id=4303&p=3 #23
http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #11
Disabling DCC in the Maldives
Disabling DCC on Global Payment terminals in the Maldives
Disabling DCC in Thailand and Taiwan
DCC present but generally not an issue. Cashier will generate quote slip is usually generated and pass to cardholder. When cardholder refuses, a verbage-free slip denominated in THB/TWD will be produced.
Certain Taiwan hotels may take deposits in cardholder currency. But these are only pre-authorisations and can be voided in full for TWD-only final checkout payments.
Disabling DCC on Websites
Airbnb - (Since the "loophole" seem not to work anymore, please report if you chargeback the DCC.
)
Hotwire - You need to select your preferred currency before making a search.
PayPal - The instructions to stop the DCC on a recurring charge are here.
I got duped by DCC already before I found this thread. Is there anything I can do?
If you've been hit with DCC and the merchant did not follow the Visa/MC rules, you should file a dispute with your card issuer. Even if the transaction is a small amount, it's worth it to dispute the charge on principle. Do not let merchants get away with this scam uncontested!
If you were not clearly given a choice of currencies and did not specifically communicate a preference to be billed in your card's native currency - if you did not accept DCC - then you have recourse when filing a dispute with your card issuer. The Visa Product and Service Rules clearly state (p 339):
You can even use terminology from Visa Product and Service Rules when filing the dispute, giving Reason Code 76: Incorrect Currency or Transaction Code. Reason Code 76 is used when the transaction was processed with an incorrect transaction code, or an incorrect currency code, or one of the following:
MasterCard's rules also clearly state that the POI Currency Conversion must be decided by both the merchant and customer. When filing a dispute with a MasterCard, list chargeback Reason Code 4846 from the MasterCard Chargeback Guide, which covers POI currency conversion disputes in the following circumstances:
You do have a choice of currencies. Exercise that choice!
Do not get taken by surprise when faced with DCC, and know your options. As Visa/MC purport, you do have a choice of currencies, but you need to make that choice heard! Don't be complacent in this sneaky tactic by some merchants to pad revenues.
Before going to a different country, get educated. Understand the exchange rate relative to your native currency. Know how to recognize when the merchant is trying to force DCC on the transaction, and pull out all of the stops to make sure it doesn't happen to you.
If you have a chip-and-PIN credit card, it's easier to control the transaction to try to prevent DCC. With chip-and-signature, if you get an uncooperative merchant, deface the merchant's copy of the receipt. Write LOCAL OPTION NOT OFFERED, cross out the DCC currency amount, and sign the receipt.
This will give additional evidence when filing a dispute to get the DCC charges refunded. When filing the dispute, you can use the Visa Exchange Rate Calculator or MasterCard's Currency Conversion Tool to determine the Visa or MasterCard exchange rate on the date the transaction posted to your credit card. Compare this to the DCC value to figure out the amount by which the merchant overcharged you. Don't forget to add in any Foreign Transaction Fee if your card has one. (If it does, you should really consider finding a card for use overseas without a FTF.)
Example Images (click for a larger image)
Hotel receipts in China, the Netherlands, and Dubai respectively:
Purchase receipts in China and Korea:
Cancelled translation in Hong Kong:
Novotel in Shenzen:
Dynamic Currency Conversion (DCC) is a "service" some merchants and ATM operators offer that will charge a cardholder in the native currency of the card rather than the local currency. A more complete definition and examples are available via this Wikipedia article on DCC. While sold as a convenience to cardholders traveling outside of their home country, it is a pure profit play by the merchants. You may end up paying a fee of up to 8% over the purchase price for accepting DCC. Always decline DCC and asked to be billed in the local currency!
Where will I see it?
You can be hit with DCC anywhere there is a difference between your debit or credit card's denominated currency and the currency of the location where you're trying to use the card. The most common example will be at a merchant overseas, but now some ATMs are offering the service too. While many US cardholders complain about getting tricked into accepting DCC overseas, some merchants in the US have started to use DCC as well.
What is the issue?
Unless you're the merchant or ATM operator, there isn't much benefit to using DCC. Some customers say they prefer knowing exactly how much they'll be charged in their home currency or may not know the exchange rate of the place where they are visiting. For example, if you are in Prague for two days and you don't know how much the Czech Koruna is worth relative to the US Dollar, you might feel more comfortable knowing that you're buying an item for $205.00 versus 4000 CZK. However, the real exchange rate as of January 18, 2014 would place 4000 CZK at $197.18. You just paid an extra $7.82 for the "convenience" of knowing how much you'd be charged!
DCC often charges about a 4% premium over the true exchange rate. The problems don't stop there since many US banks still charge a 3% foreign transaction fee (FTF) for purchases made outside of the US. Not only would you get hit with the $205.00 charge, you could also find yourself facing a total charge of $211.15 if your card has a 3% FTF.
This is a pure money grab from the merchants, and it's billed as an easy way to squeeze additional revenue out of the transaction. Numerous [1, 2] articles have talked about DCC duping many consumers. Discover even has a warning about being tricked into DCC when using a card abroad.
For example, this FlyerTalk member reported that Avis charged his Saudi credit card in Saudi riyals instead of USD for a car rental in Florida without his consent. This has also been a trend for hotels, particularly large chains as indicated here and here.
DCC is simply not worth it for the consumer. Unless you like paying a convenience fee of up to 5% of the total transaction just to know how much you will be billed, you should always decline DCC and ask to be billed in local currency when handing over your card.
Furthermore, it is in your interest to obtain a card that has a 0% FTF. FlyerTalk member kebosabi maintains a fairly comprehensive spreadsheet of EMV-enabled cards ideal for overseas travel, many of which offer a low or 0% FTF as a feature. There is also a wiki at FlyerGuide of various FTF of debit and credit cards.
What can I do to avoid DCC?
American Express currently does not support DCC on its network, so you are safe from DCC if using an American Express card. However, Visa and MasterCard card networks can support DCC, so be vigilant when purchasing abroad with a Visa or MasterCard branded card. There have been reports of being charged DCC with a Discover card in China [citation needed], but primarily the issue is happening with Visa and MasterCard cards.
Before handing your card to the merchant, always specify clearly that you want to be charged in the local currency and that you do not want DCC. For some transactions, you retain control of your card as you dip it into a chip reader and can view on a screen to select which currency you want to use for the transaction. Always select the local currencyto get the best exchange rate. Do not select the card's native currency!
Similarly, for ATM withdrawals, make sure you decline any kind of conversions. Some good examples of what to look for when using an ATM overseas are here and here. You're probably coming off of a long flight and fatigued, but educating yourself beforehand can save you from getting ripped off. The user interfaces on almost all of these ATMs are set up to encourage you to take the bait, and you have to be extremely vigilant not to fall for it.
If you are doing a PIN-based transaction, you should have the opportunity to review the total amount and denomination of the transaction before entering your PIN. If you are doing a signature transaction and the merchant has processed your transaction with DCC, cross out the amount and write "DCC refused" on the receipt. Do not sign the receipt, and demand that the merchant reverse the transaction and run it in the local currency. If no verification is required due to a small purchase amount, ask the merchant to reverse the charge and repeat the transaction using local currency. If all else fails, file a dispute with your card issuer when you return home. Even if it's immaterial, the banks will get the message like they did with EMV.
Some merchants will claim that their systems have to bill you in your native currency. This is a complete lie. But just like a mag stripe only card, this is battle where you have to be prepared. Don't settle for merchants claiming that "it has to be done this way" or "pay cash if you don't want this". Be prepared to walk away, and, if you must complete the transaction, write "DCC refused & merchant didn't give a choice" on the receipt and cross out the amount. Let the merchant know that you will be filing a dispute with your bank.
Disabling DCC
Disabling DCC on ANZ terminals in Australia
ANZ markets DCC as Customer Preferred Currency (CPC). Terminal operators can contact ANZ Merchant Services at 1800 039 025 to have this feature disabled. Currently, your Visa or MasterCard will be subjected to DCC if denominated in: CAD, CHF, DKK, EUR, GBP, HKD, JPY, MYR, NOK, NZD, SEK, SGD, THB, USD, or ZAR. All DCC transactions on ANZ will cause a 2.5% markup. Steps to avoid DCC:
- Insert, swipe, or tap your payment card
- Have the cashier select credit (CR)
- The terminal will display CREDIT ACCOUNT
- If applicable, enter your PIN
- The terminal will display PROCESSING \ PLEASE WAIT
- The terminal will display EXCH <exchange rate> \ <currency> <amount> \ ACCEPT RATE? \ ENTER=YES CLR=NO
- Instruct the cashier to press the yellow CLEAR (CLR) button (If entering a PIN, you can retain the terminal to perform this step yourself. If entering a signature, you can ask for the terminal to control this process, not indicating that it's a chip-and-signature card.)
- The transaction should now process without DCC
If you see a signature slip with DCC verbiage and a checkbox indicating a currency selection, kindly ask the merchant to void the transaction. If it's a PIN-based transaction, you have an additional opportunity to cancel the transaction because it will ask for your PIN a second time. For instance, if you see "EUR 17.29 KEY PIN" refuse to enter your PIN and start again.
Disabling DCC in China
There are many reports of forced DCC in China, and there is a great thread [closed to new posts] on DCC in China on the the China Destinations forum.
Disabling DCC on Bankcomm terminals in Beijing http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #19
jair101's DCC instructions of March 2011 http://www.etveg.com/misc/DCC_China.pdf
Disabling DCC in Eurozone and UK
DCC offered in tourist traps (Harrods Knightsbridge/Galleries Lafayette Montparnesse/El Cortes Ingles Grand Via Madrid)
Unlike the rest of the world, Visa Europe does not require merchants to collect a ticked box on the slip (presumably because merchants there don't keep signed slips under Chip-and-PIN)
El Cortes Ingles collects a signature electronically and the DCC selection is made on the signature pad - the choice is respected.
Harrods and GL rely on cashier input in the POS for the currency choice - the cashier may forget to ask. The POS do not offer voiding (only refunds), but since you're given a slip to sign the best thing to do is to deface it before signing and submit chargeback request to issuer bank on return home.
There may be smaller merchants who also collect DCC but I seemed to have pre-empted most of them by saying "charge Euros (Pounds) please"
In Spain all merchants by law are required to provide you with a complaint form called an hoja de reclamaciones if requested. The form has two carbon copies. The customer retains one copy as a record of the complaint. The merchant maintains another copy, and the third is sent to the local consumer protection bureau. Merchants are also required to post a sign conspicuously informing the customer of the right to complain (usually in Spanish and English). Do not accept the lie that they don't have any forms. This is illegal, and you are able to call the police if the merchant refuses to provide you with this official form. It's interesting to see merchants start to squirm when you know the rules, and most merchants will start to be accommodating after you mention it. (Please still fill out the form even if the merchant cooperates after mentioning it because these are likely the merchants who won't otherwise change their behavior.)
Disabling DCC in Hong Kong and Macau
Hong Kong and Macau can get as non-compliant as China, possibly because many acquirers have cross-border operations and know they can get away with non-compliant firmware and procedures.
In practice, if you are given a DCC slip, and the cashier has not taken a choice before giving you your copy, the slip will be processed in your home currency - be prepared to dispute.
Unable to disable Global Payments DCC in Hong Kong instance #1, instance #2
Unable to disable DBS DCC in Fortress Electronics HK
Unable to disable BoC DCC in Free Duty HK
Disabling DCC in Japan and Korea
Japan's just starting out http://www.flyertalk.com/forum/japan...ing-japan.html and http://www.hongkongcard.com/forum/fo...p?id=3939&p=17 #168 but there are no reports I know of where cardholders are compelled to use DCC against their will.
Korea is also not much affected by DCC but where offered, trying to opt out is harder than Japan due to the language barrier (both verbal and written)
http://www.hongkongcard.com/forum/fo...hp?id=4303&p=3 #23
http://www.hongkongcard.com/forum/fo...p?id=12272&p=2 #11
Disabling DCC in the Maldives
Disabling DCC on Global Payment terminals in the Maldives
Disabling DCC in Thailand and Taiwan
DCC present but generally not an issue. Cashier will generate quote slip is usually generated and pass to cardholder. When cardholder refuses, a verbage-free slip denominated in THB/TWD will be produced.
Certain Taiwan hotels may take deposits in cardholder currency. But these are only pre-authorisations and can be voided in full for TWD-only final checkout payments.
Disabling DCC on Websites
Airbnb - (Since the "loophole" seem not to work anymore, please report if you chargeback the DCC.
)Hotwire - You need to select your preferred currency before making a search.
PayPal - The instructions to stop the DCC on a recurring charge are here.
I got duped by DCC already before I found this thread. Is there anything I can do?
If you've been hit with DCC and the merchant did not follow the Visa/MC rules, you should file a dispute with your card issuer. Even if the transaction is a small amount, it's worth it to dispute the charge on principle. Do not let merchants get away with this scam uncontested!
If you were not clearly given a choice of currencies and did not specifically communicate a preference to be billed in your card's native currency - if you did not accept DCC - then you have recourse when filing a dispute with your card issuer. The Visa Product and Service Rules clearly state (p 339):
- Merchants that offer DCC must be compliant with the regulations
- Inform the cardholder that DCC is optional
- Not impose any additional requirements to use local currency
- Not use any language or procedures that may cause the cardholder to choose DCC by default
- Not convert a transaction in the local currency to the card's billing currency after the transaction has completed
- Ensure that the cardholder expressly agrees to DCC
You can even use terminology from Visa Product and Service Rules when filing the dispute, giving Reason Code 76: Incorrect Currency or Transaction Code. Reason Code 76 is used when the transaction was processed with an incorrect transaction code, or an incorrect currency code, or one of the following:
- Merchant did not deposit a transaction receipt in the country where the transaction occurred
- Cardholder was not advised that Dynamic Currency Conversion (DCC) would occur
- Cardholder was refused the choice of paying in the merchants local currency
- Merchant processed a credit refund and did not process a reversal or adjustment within 30 calendar days for a transaction receipt processed in error
MasterCard's rules also clearly state that the POI Currency Conversion must be decided by both the merchant and customer. When filing a dispute with a MasterCard, list chargeback Reason Code 4846 from the MasterCard Chargeback Guide, which covers POI currency conversion disputes in the following circumstances:
- The cardholder states that he or she was not given the opportunity to choose the desired currency in which the transactions was completed or did not agree to the currency of the transaction, or
- POI currency conversion took place into a currency that is not the cardholder's billing currency, or
- POI currency conversion took place when the goods or services were priced in the cardholder's billing currency, or
- POI currency conversion took place when cash was disbursed in the cardholdeer's billing currency.
You do have a choice of currencies. Exercise that choice!
Do not get taken by surprise when faced with DCC, and know your options. As Visa/MC purport, you do have a choice of currencies, but you need to make that choice heard! Don't be complacent in this sneaky tactic by some merchants to pad revenues.
Before going to a different country, get educated. Understand the exchange rate relative to your native currency. Know how to recognize when the merchant is trying to force DCC on the transaction, and pull out all of the stops to make sure it doesn't happen to you.
If you have a chip-and-PIN credit card, it's easier to control the transaction to try to prevent DCC. With chip-and-signature, if you get an uncooperative merchant, deface the merchant's copy of the receipt. Write LOCAL OPTION NOT OFFERED, cross out the DCC currency amount, and sign the receipt.
This will give additional evidence when filing a dispute to get the DCC charges refunded. When filing the dispute, you can use the Visa Exchange Rate Calculator or MasterCard's Currency Conversion Tool to determine the Visa or MasterCard exchange rate on the date the transaction posted to your credit card. Compare this to the DCC value to figure out the amount by which the merchant overcharged you. Don't forget to add in any Foreign Transaction Fee if your card has one. (If it does, you should really consider finding a card for use overseas without a FTF.
)Example Images (click for a larger image)
Hotel receipts in China, the Netherlands, and Dubai respectively:
Purchase receipts in China and Korea:
Cancelled translation in Hong Kong:
Novotel in Shenzen:
Dynamic Currency Conversion (DCC) [2014-2016]
Sep 12, 2014 | 5:57 am
#1021
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
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.
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.
Last edited by zyxlsy; Sep 12, 2014 at 7:35 am
Sep 12, 2014 | 6:27 am
#1022
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,112
Agree. This is like my Maldives DCC case which was posted properly in USD in the end.
Sep 12, 2014 | 7:55 am
#1023
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
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.
Sep 13, 2014 | 3:41 am
#1024
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
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.
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.
Sep 13, 2014 | 5:01 am
#1025
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
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.
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.
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.
Sep 13, 2014 | 6:56 am
#1026
Join Date: Feb 2013
Location: Irvine CA & PEK
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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.
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.
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.
Sep 13, 2014 | 10:24 am
#1027
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
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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)
Last edited by percysmith; Sep 13, 2014 at 12:46 pm
Sep 13, 2014 | 12:13 pm
#1028
Join Date: Jan 2008
Location: Rio de Janeiro, Miami
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Posts: 4,749
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.
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.
Sep 13, 2014 | 12:18 pm
#1029
Join Date: Jan 2008
Location: Rio de Janeiro, Miami
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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.
Sep 13, 2014 | 12:22 pm
#1030
Join Date: Jan 2008
Location: Rio de Janeiro, Miami
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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.
Sep 13, 2014 | 12:55 pm
#1031
Ambassador, Hong Kong and Macau
Join Date: May 2009
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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):
(this screen only displays for three seconds)
Good slip:
*** must press cancel within three seconds of this screen appearing ***
(press Enter)
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.
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):
(this screen only displays for three seconds)
Good slip:
*** must press cancel within three seconds of this screen appearing ***
(press Enter)
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.
Last edited by percysmith; Sep 14, 2014 at 8:18 pm
Sep 13, 2014 | 3:03 pm
#1032
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Join Date: May 2009
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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.
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?
Sep 13, 2014 | 6:12 pm
#1033
Original Poster
Join Date: Jul 2009
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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.
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?
At any rate, I imagine the checkbox receipt like that would be a rock solid case in the event of an actual chargeback, right?
Sep 13, 2014 | 7:48 pm
#1034
A FlyerTalk Posting Legend
Join Date: Dec 2000
Location: Shanghai
Posts: 46,317
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.
Sep 13, 2014 | 8:51 pm
#1035
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
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.