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]
Oct 13, 2014 | 9:58 am
#1186
Join Date: Jun 2014
Posts: 46
Did the receipt just contain the DCC verbiage or was it denominated in USD? I think this is similar to my experience at Chung Yo Department Store in Taichung. You can clearly see the DCC wording, but the charge is in NTD and there is no mention of USD on the receipt. While the DCC amount is held in this case, as others have pointed out, the transaction will post without DCC.
You have to worry when you get final receipts with: [ ]HKD [ ]USD and nothing checked (such as carbon copy slips), [X]USD checked, or DCC verbiage with a USD amount/exchange rate included on the receipt. For instance, percysmith and I ate at Greyhound Cafe on Saturday night, and we were presented with the carbon copy charge slip. If you tick [X]HKD AMOUNT, nothing will happen. There is no cashier interaction with the terminal regarding currency selection after running the transaction.
You have to worry when you get final receipts with: [ ]HKD [ ]USD and nothing checked (such as carbon copy slips), [X]USD checked, or DCC verbiage with a USD amount/exchange rate included on the receipt. For instance, percysmith and I ate at Greyhound Cafe on Saturday night, and we were presented with the carbon copy charge slip. If you tick [X]HKD AMOUNT, nothing will happen. There is no cashier interaction with the terminal regarding currency selection after running the transaction.
Oct 13, 2014 | 10:00 am
#1187
Join Date: Jun 2014
Posts: 46
Has anyone encountered DCC here? I mean with foreigners since we have USD denominated cards.
Oct 13, 2014 | 10:04 am
#1188
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
My spouse and I went to Disneyland Hong Kong today, and I decided to use my Chase Sapphire Preferred knowing that I'd be gearing up for a battle. The POS system did not disappoint as I saw the carbon copy print out:
The exchange was as follows:
Me: I want to be charged HKD.
Cashier: Here... ::circles HKD:: Hong Kong Dollars
Me: I sign and then what happens? How do I make sure it's HKD
Cashier: If you circle HKD you get Hong Kong Dollars
Me: Do you press a button to make sure I get Hong Kong Dollars?
The cashier at this point handed me the thermal slip:
The thermal slip didn't contain any mention of DCC, USD, or an exchange rate. It's denominated in HKD, and the trace code is one higher than the carbon copy slip. This gave me enough reassurance that the [X]HKD was in the system, but all too often we've heard the case with carbon copy slips that your manual tick on the box just goes into a black hole, and the only time it would be consulted would be during a chargeback.
We had dinner at Maxim's, and I have to admit that I copped out and paid with AmEx to avoid my wife rolling her eyes:
I'll look at the exchange rate once the transaction posts to see how AmEx's rate compares to Visa's. I'd imagine for HKD that the rates would be about the same since the HKD:USD is pegged to a narrow band.
Oct 13, 2014 | 10:38 am
#1189
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
A thermal slip is the one we're used to seeing in the US. It's called a thermal slip because the white paper will turn black when exposed to heat. Most new point of sale terminals use thermal paper. However, in Hong Kong carbon copy slips are far more prevalent. The good thing for us with carbon copy slips is that your currency choice is abundantly clear and provides rock solid evidence if your issuer pursues a Reason Code 76 chargeback.
I have a few theories on why DCC is rare in the US. The first is the market size. The US has hundreds of millions of cardholders with USD denominated cards. These far outweigh the non-USD denominated cards. While cards denominated in the local currency very likely comprise the vast majority of cards in a particular area, I would venture a guess that the number of non-HKD denominated cards both in absolute numbers as well as as a percentage of the all credit card holders currently in HK is higher than in even a place like NYC. So, I don't think that even with DCC in the US that it would ensnare many people.
Second, the US is an extremely litigious society. Do you think some of these non-compliant acquirers/merchants would survive a class action lawsuit from thousands of angry cardholders whose currency choices weren't respected? DCC is scammy and deceptive in how it's implemented in every case I've seen, even when I've been given a clear choice. Eventually, we would need big bold letters indicating exactly the percentage of the DCC markup just like we need calorie counts on menus or warning labels to let us know our coffee is hot.
Third, I've heard the argument that DCC is mostly something that sprout up in response to consumer demand, namely from American cardholders when traveling overseas. Some Americans demand to know how much an item costs in "real money" or wonder why they can't pay in dollars everywhere they go. DCC allows them to do this, and by all means I'm for merchants making a slight profit off of these types. The problem is that there is a lot of collateral damage. Most Americans I've met abroad do not fall into the ugly American stereotype. However, unless you're like the few of us on this thread, you probably won't know how to opt out of DCC or realize you've been struck.
I would be surprised if many merchants in the US support DCC, but what we really need to do is get reports from people who've tried their cards at the you-name-it big box retailers, restaurants, and department stores. I'm really curious to know if Macy's, Bloomingdale's, Nordstrom and the like have DCC.
Oct 13, 2014 | 10:48 am
#1190
Join Date: May 2007
Location: NJ
Posts: 46
All hotel stays were on points and only had to pay small taxes at Sheraton Guilin - the ONLY time I used CC which I opted for AMEX Plat and said card was also used for "deposit" as the Chinese called it, at each check in. STRANGELY, I could not see ANY such authorization as pending on AMEX online account but chat rep confirmed the authorizations were there. At check out, all hotels did a reversal of the authorization but AMEX claimed they did not see it - so the authorizations fell off by themselves after 8 business days. Odd. Why would authorizations made in China not showed up on AMEX online as Pending?
Oct 13, 2014 | 5:36 pm
#1191
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
Hong Kong Disney used to have info screen of the POS hanging onto the glass so you see your options "USD" and "HKD" and even their final amounts.
Not anymore?
Not anymore?
Oct 13, 2014 | 9:25 pm
#1192
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
The way it works now is they give you a carbon copy slip with the rate printed on that slip. I don't like these carbon copy slips because you don't know what happens after the fact. As we've seen in the cases of Greyound Cafe and Coyote Bar in Hong Kong, the cashier just files away the merchant copy of the receipt, but there is no further input on the part of the cashier to select the currency. I have been taught to be extremely skeptical that my currency choice will be honored when I see the boxes on a carbon copy receipt. In this case the card terminal seems integrated with the register, and the trace number was higher for the detailed receipt. This detailed receipt only showed a HKD amount, so I have reason to believe I have been opted out successfully.
More transactions posted...
TW Transactions:
1) Taiwan HSR (no DCC) posted at $38.82:
1180 TWD x 0.032902 USD/TWD = 38.82 USD
2) Novotel Taoyuan (DCC opt out) posted at $217.88:
6622 TWD x 0.032902 USD/TWD = 217.88 USD
228.17 USD - 217.88 USD = 10.29 USD saved by not using DCC
And this concludes another DCC-free trip to Taiwan... terminals are still fully compliant, and cashiers respect DCC choices. ^
HK Transactions:
3) Francfranc (DCC opt out) posted at $218.12:
1691.50 HKD x 0.128948 USD/HKD = 218.12 USD
229.00 USD - 218.12 USD = 10.88 USD saved by not using DCC
Oct 13, 2014 | 9:27 pm
#1193
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
I did suggest (to majuki I think) banks may eventually respond to this by issuing multi-currency cards to try recapture the DCC profit.
Actually after reading ausbt.com.au I realised Commonwealth Bank of Australia has been doing this for some time https://www.commbank.com.au/personal...ard.html...but the rates on that product are so toxic https://service.commbank.com.au/tool...alculator.aspx it might be simpler to just accept DCC than use that product.
Actually after reading ausbt.com.au I realised Commonwealth Bank of Australia has been doing this for some time https://www.commbank.com.au/personal...ard.html...but the rates on that product are so toxic https://service.commbank.com.au/tool...alculator.aspx it might be simpler to just accept DCC than use that product.
Last edited by percysmith; Oct 13, 2014 at 9:32 pm
Oct 13, 2014 | 10:52 pm
#1194
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
It's also likely that banks will move to foreign transaction fees rather than currency exchange fees much like US banks have. Even if you accept DCC it doesn't matter. You're getting smacked with a 1-3% FTF on cards that have one in addition to the poor DCC rate.
Oct 14, 2014 | 12:50 am
#1195
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
https://www.commbank.com.au/personal...s-charges.html
International Transaction5 :
Transactions converted by MasterCard or Visa (5): 3.00%
Transactions converted by American Express (5) : 2.00%
Transactions overseas but in Australian dollars(6): 2.00%
The fees are only 1% apart.
It's just whether you like to be scalped by Commbank or scalped by Global Payments and its ilk.
I happily pay for my mates when they are here or when we're travelling around Asia. They then credit my Australian NAB/HSBC accounts at the Yahoo mid-rate. I spend down the Aussies when the missus and I visit down under (it costs us a fair bit to convert into Aussies too)
International Transaction5 :
Transactions converted by MasterCard or Visa (5): 3.00%
Transactions converted by American Express (5) : 2.00%
Transactions overseas but in Australian dollars(6): 2.00%
The fees are only 1% apart.
It's just whether you like to be scalped by Commbank or scalped by Global Payments and its ilk.
I happily pay for my mates when they are here or when we're travelling around Asia. They then credit my Australian NAB/HSBC accounts at the Yahoo mid-rate. I spend down the Aussies when the missus and I visit down under (it costs us a fair bit to convert into Aussies too)
Oct 14, 2014 | 1:13 am
#1196
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
Have we ever seen a DCC scalp at 1%? In most cases you're paying the 2% + 4-5% DCC scalp. At least they're more generous. US issuers typically bill you the 3% regardless of whether or not Visa/MC performs the exchange.
Oct 14, 2014 | 1:16 am
#1197
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
For HKD, Commbank is currently offering 6.4646 for their Travel Money Card. Yahoo rate is currently 6.801 (5% less). Choose your poison.
Oct 14, 2014 | 2:39 am
#1198
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
If I'm not feeling like a fight I just use AmEx. If that option ever goes away I don't know what I'll do.
Oct 14, 2014 | 6:22 am
#1199
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
Banks here will accept your overseas passport and (mailed) overseas residential address proof, but you have to get money here and keep the account active through use.
Oct 14, 2014 | 9:13 am
#1200
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
Alright, I think I successfully dodged DCC in HK with an honorable mention to percysmith to assisting me at Greyhound Cafe. While we weren't able to get out of DCC there, he helped me void the sale, which in turn avoided DCC.
I still have two pending transactions, the one from Disneyland and a second transaction from today at Franc Franc. Fortunately, I know how the Franc Franc transaction will play out based on experience. I'm hopeful that Disneyland will be without DCC too.
I had an interesting experience upon checkout at the Courtyard on Hong Kong Island. The BoC terminal that they use will not print the DCC verbiage nor hold the DCC amount for a PREAUTH. The carbon copy receipt I signed was denominated in HKD, but I was so fixated on looking for the DCC verbiage and the transaction amount that I failed to notice that the transaction was HK$9298 whereas my bill was HK$9295. Not wanting a back office reconciliation that resulted in DCC, I returned to the front desk and got them to void the first sale. I had them rerun the transaction (again in HKD) for the correct amount of HK$9295. I will post receipts when I get home and have access to my scanner. Meanwhile, I'm enjoying my last 30 mintues at the Wing CX lounge at HKG.
With the help of percysmith, moondog, cxua, and I will be following up with the non-compliant Global Payments terminal to see if we can't get the situation rectified.
Thanks again to percysmith for your help at Greyhound Cafe. ^
Also, the Disneyland Maxim Palace receipt posted. They used a rate of 0.128907 for 10/13. Visa's HKD:USD rate for 10/13 was 0.128948. AmEx's rate is 0.032% lower than Visa's for this transaction, but I would consider them to be practically the same. However, I recognize that this is a) only one data point and b) for a currency fixed to the USD within a narrow exchange rate.
I still have two pending transactions, the one from Disneyland and a second transaction from today at Franc Franc. Fortunately, I know how the Franc Franc transaction will play out based on experience. I'm hopeful that Disneyland will be without DCC too.
I had an interesting experience upon checkout at the Courtyard on Hong Kong Island. The BoC terminal that they use will not print the DCC verbiage nor hold the DCC amount for a PREAUTH. The carbon copy receipt I signed was denominated in HKD, but I was so fixated on looking for the DCC verbiage and the transaction amount that I failed to notice that the transaction was HK$9298 whereas my bill was HK$9295. Not wanting a back office reconciliation that resulted in DCC, I returned to the front desk and got them to void the first sale. I had them rerun the transaction (again in HKD) for the correct amount of HK$9295. I will post receipts when I get home and have access to my scanner. Meanwhile, I'm enjoying my last 30 mintues at the Wing CX lounge at HKG.
With the help of percysmith, moondog, cxua, and I will be following up with the non-compliant Global Payments terminal to see if we can't get the situation rectified.
Thanks again to percysmith for your help at Greyhound Cafe. ^
Also, the Disneyland Maxim Palace receipt posted. They used a rate of 0.128907 for 10/13. Visa's HKD:USD rate for 10/13 was 0.128948. AmEx's rate is 0.032% lower than Visa's for this transaction, but I would consider them to be practically the same. However, I recognize that this is a) only one data point and b) for a currency fixed to the USD within a narrow exchange rate.
Last edited by Majuki; Oct 14, 2014 at 9:19 am