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 16, 2014 | 9:01 pm
#1231
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
I have to wonder if you just keep getting bad reps when you call... I haven't dealt with CSP's customer service line, but the Marriott card has good staff.
That's right. If your card charges a currency exchange fee, that would not be charged in the case of DCC. If it has a FTF, the FTF is charged regardless of the currency denomination of the transaction.
Oct 16, 2014 | 10:57 pm
#1232
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
Sir which currency you want? (USD it only can be
)You choose to opt out DCC? (We will DCC you anyway
)We will give you a courtesy slip. (You are so DCCed no matter what
)
Oct 17, 2014 | 12:19 am
#1233
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
The only way DCC benefits customers is that bank doesn't charge 3% on foreign transaction fees, and two days later of the transaction there is a huge dip (more than 5%) of the home currency. This way if letting Visa/MC deal with the exchange, the posting exchange rate would cost more than 5%...
Oct 17, 2014 | 12:23 am
#1234
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
I faxed in all the information to the dispute center last week. I received a call this morning and they advised me again that the service was rendered and they have no control of how the merchant decides to charge. I explained once more that they've incorrectly charged in USD instead of the local merchant currency as indicated on the signed receipt. She repeated that Chase has no say in how merchants charge.
If you're really keen on charging an overseas spending to a certain card (as I was with Citi in Maldives) then see if a courtesy slip can be provided.
Oct 17, 2014 | 5:56 am
#1235
Join Date: Jul 2007
Posts: 1,762
Several decades ago, it was the suggestion of what was supposedly a reliable travel editor that merchants might hold back depositing charge slips if a particular currency was hving a tough time i.e. say a British merchants took an American credit card at a time the USD relative to the GBP was in a state of decline. This "genius" claimed the merchant would find it advantageous to hold on to the charge for a bit of time waiting for the USD to decline further. Of course people here with a degree of inteligence realize how absurd this was even then as the merchant gets his or hers in their own currency and it makes no difference to them whether GBP 10 becomes USD 1.60 or USD 1.63 or USD 1.70....but that was the advice. Ugh.
Today, 99% of charges are done electronically, are in the merchant's bank account the next day and in the network at the same time so perhaps a day later the charge is posted.
As far as ftf's are concerned, it is not the currency it is where the merchant's bank processor is located. That is why many people who buy airline tickets, even from a US agency which is acting for the foreign airline, get nailed for a ftf on airline tickets on a purchase that they feel never leaves the USA but in reality is processed by the airline's acquirer in the country the airline is located.
Today, 99% of charges are done electronically, are in the merchant's bank account the next day and in the network at the same time so perhaps a day later the charge is posted.
As far as ftf's are concerned, it is not the currency it is where the merchant's bank processor is located. That is why many people who buy airline tickets, even from a US agency which is acting for the foreign airline, get nailed for a ftf on airline tickets on a purchase that they feel never leaves the USA but in reality is processed by the airline's acquirer in the country the airline is located.
Oct 17, 2014 | 6:42 am
#1236
Join Date: Feb 2013
Location: Irvine CA & PEK
Programs: Hyatt Globalist, Marriott Titanium, Hilton Diamond, IHG Spire Ambassador, Qantas Platinum, United S
Posts: 664
As far as ftf's are concerned, it is not the currency it is where the merchant's bank processor is located. That is why many people who buy airline tickets, even from a US agency which is acting for the foreign airline, get nailed for a ftf on airline tickets on a purchase that they feel never leaves the USA but in reality is processed by the airline's acquirer in the country the airline is located.
Oct 17, 2014 | 8:27 am
#1237
Join Date: Jul 2007
Posts: 1,762
No. Like so many bank fees it is there to rip more money from their customers. Many fees have no basis in reality other than as a way to pad the banks' profits. The ftf is one of them as the banks have nothing to do with currency fluctuations or risks inherent in them (which was the original reason given for foreign currency fees). The banks do nothing in a credit card transaction in a foreign currency. The conversion is done by mc and visa who assume all the risks of currency fluctuations and to a degree might justify the 1% fee mc and visa place on foreign currency conversions.
Extending that fee to all foreign transactions, even thouse involved with dcc or those processed outside the USA in the case of USA banks was a direct response to dcc in a way. It is one of the biggest rip off fees banks pull and quite frankly if I were a congressman, I woujld be pushing legislation to prohibit this fee (as well as make fees for overdrawn accounts, exceding credit limits on credit cards much more reasonable).
Extending that fee to all foreign transactions, even thouse involved with dcc or those processed outside the USA in the case of USA banks was a direct response to dcc in a way. It is one of the biggest rip off fees banks pull and quite frankly if I were a congressman, I woujld be pushing legislation to prohibit this fee (as well as make fees for overdrawn accounts, exceding credit limits on credit cards much more reasonable).
Oct 17, 2014 | 9:27 am
#1238
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
No. Like so many bank fees it is there to rip more money from their customers. Many fees have no basis in reality other than as a way to pad the banks' profits. The ftf is one of them as the banks have nothing to do with currency fluctuations or risks inherent in them (which was the original reason given for foreign currency fees). The banks do nothing in a credit card transaction in a foreign currency. The conversion is done by mc and visa who assume all the risks of currency fluctuations and to a degree might justify the 1% fee mc and visa place on foreign currency conversions.
Extending that fee to all foreign transactions, even thouse involved with dcc or those processed outside the USA in the case of USA banks was a direct response to dcc in a way. It is one of the biggest rip off fees banks pull and quite frankly if I were a congressman, I woujld be pushing legislation to prohibit this fee (as well as make fees for overdrawn accounts, exceding credit limits on credit cards much more reasonable).
Extending that fee to all foreign transactions, even thouse involved with dcc or those processed outside the USA in the case of USA banks was a direct response to dcc in a way. It is one of the biggest rip off fees banks pull and quite frankly if I were a congressman, I woujld be pushing legislation to prohibit this fee (as well as make fees for overdrawn accounts, exceding credit limits on credit cards much more reasonable).
The bottom line is that Visa/MC impose a 1% currency exchange fee and pass this on to the issuer when a currency exchange happens. The issuer then typically adds a 2% markup. I tend to think customers just bend over and take it when it comes to overseas transactions, assuming that's just the price one pays for traveling abroad.
I personally find the 1% fee that Visa/MC impose to be acceptable due to the costs of handling different currencies. I can even somewhat justify AmEx's rate of 2.7% for personal cards with a FTF since their operations are smaller worldwide. However, I would still contend AmEx's true cost of conversion is much lower. I understand that there are risks converting currencies, and there are some currencies that fluctuate relative to one another than others such that the 1% fee is reasonable. It would be far too complicated to have a list of different exchange rates for different countries, so they set the bar at 1%. I'm fine if banks pass along this 1% fee to me as the customer but only if the conversion actually takes place. In the case of DCC or a foreign acquirer pricing in USD, the issuer that charges 3% is pocketing the entire amount.
On the other hand, I've described DCC exchange rates as usurious, which they are. I've seen anywhere between 3.95-4.99% as the offer, but the high exchange rates are necessary in order to pull off DCC successfully. I would have little problem with DCC or not cringe as much if the markup were 1-2%, but the acquirer in those cases wouldn't be able to offer DCC profitably. The acquirer certainly wouldn't be able to do some profit sharing agreement with the merchant. The result of this profit sharing arrangement and the higher currency exchange risk that a single acquirer assumes results in a rip-off exchange rate.
Oct 17, 2014 | 11:29 am
#1239
Join Date: Jun 2013
Posts: 81
Wow. I received a call from Chase dispute department just 5 minutes ago. Long story short:
The customer rep who just called me was the original person who had received my dispute document via fax. She entered the information into the dispute system and called me, but missed her call. Her colleague followed up with what transpired last night.
The original rep made a reminder for herself to try me again and saw the notes on my account as what had happened. She called me just now and said, are you satisfied with the resolution of your dispute?
I said, well no. And she said, Yes I agree. She understands what DCC is and the impact, and said the paperwork I have provided is black and white. She initiated the charge back and put a temp credit of $83.76 USD on my account and asked me to wait 45 days for the merchant to respond. If not, it becomes permanent.
I told her she had restored my faith in people knowing to do the right thing. She replied, that its not ethical what the merchant did, and thanked me for being so patient.
^
The customer rep who just called me was the original person who had received my dispute document via fax. She entered the information into the dispute system and called me, but missed her call. Her colleague followed up with what transpired last night.
The original rep made a reminder for herself to try me again and saw the notes on my account as what had happened. She called me just now and said, are you satisfied with the resolution of your dispute?
I said, well no. And she said, Yes I agree. She understands what DCC is and the impact, and said the paperwork I have provided is black and white. She initiated the charge back and put a temp credit of $83.76 USD on my account and asked me to wait 45 days for the merchant to respond. If not, it becomes permanent.
I told her she had restored my faith in people knowing to do the right thing. She replied, that its not ethical what the merchant did, and thanked me for being so patient.
^
I would really suggest adopt See and Avoid VFR under most circumstances. In my 2011 Taiwan trip I voided every single slip with a box.
If you're really keen on charging an overseas spending to a certain card (as I was with Citi in Maldives) then see if a courtesy slip can be provided.
If you're really keen on charging an overseas spending to a certain card (as I was with Citi in Maldives) then see if a courtesy slip can be provided.
Oct 17, 2014 | 1:00 pm
#1240
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
Wow. I received a call from Chase dispute department just 5 minutes ago. Long story short:
The customer rep who just called me was the original person who had received my dispute document via fax. She entered the information into the dispute system and called me, but missed her call. Her colleague followed up with what transpired last night.
The original rep made a reminder for herself to try me again and saw the notes on my account as what had happened. She called me just now and said, are you satisfied with the resolution of your dispute?
I said, well no. And she said, Yes I agree. She understands what DCC is and the impact, and said the paperwork I have provided is black and white. She initiated the charge back and put a temp credit of $83.76 USD on my account and asked me to wait 45 days for the merchant to respond. If not, it becomes permanent.
I told her she had restored my faith in people knowing to do the right thing. She replied, that its not ethical what the merchant did, and thanked me for being so patient.
^
The customer rep who just called me was the original person who had received my dispute document via fax. She entered the information into the dispute system and called me, but missed her call. Her colleague followed up with what transpired last night.
The original rep made a reminder for herself to try me again and saw the notes on my account as what had happened. She called me just now and said, are you satisfied with the resolution of your dispute?
I said, well no. And she said, Yes I agree. She understands what DCC is and the impact, and said the paperwork I have provided is black and white. She initiated the charge back and put a temp credit of $83.76 USD on my account and asked me to wait 45 days for the merchant to respond. If not, it becomes permanent.
I told her she had restored my faith in people knowing to do the right thing. She replied, that its not ethical what the merchant did, and thanked me for being so patient.
^
In the end, it didn't take that long to go through the process, and this too restores my faith in Chase for doing the right thing. I was worried initially when they were telling you to pound sand and then reluctantly issued the courtesy credit.
It'll be interesting to see how Global Payments and Greyhound Cafe respond to the chargeback. Perhaps percysmith can shed some light on this, but does Global Payments simply toss the hot potato to Greyhound Cafe when they received the chargeback? If Greyhound's Global Payments terminals can't disable DCC how do they process the chargeback?
You told me at the restaurant that it really wouldn't matter to Greyhound Cafe since, at the end of the day, they should still get the HKD 623.00 out of this transaction assuming they can send it back over in HKD. If they don't, cxua got a free meal?
Oct 17, 2014 | 1:29 pm
#1241
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
I never ate at A Lorcha http://www.flyertalk.com/forum/china...on-44.html#660 again - I've found way better restaurants in Macau to go to. I never bothered to contact them after the meal either - I don't know if they have an email address and I'm not paying for IDD if I can avoid it.
I imagine one of two things happened:
1. My issuer took the HK$562.73 back. Banco National Ultramarino deducted MOP564.30 from A Lorcha. A Lorcha asked BNU to charge me again in MOP this time based on their merchant copy and the slip was re-presented.
2. My issuer took the HK$562.73 back. As BNU already had the copy of the slip it recharged my issuer MOP564.30 without reference to A Lorcha.
Unless a Citi Prestige-like offer comes along it'd be more worthwhile for me to use Unionpay in Macau - Unionpay rate is competitive here, no foreign currency translation charge and decent $6/mile earn rate.
I imagine one of two things happened:
1. My issuer took the HK$562.73 back. Banco National Ultramarino deducted MOP564.30 from A Lorcha. A Lorcha asked BNU to charge me again in MOP this time based on their merchant copy and the slip was re-presented.
2. My issuer took the HK$562.73 back. As BNU already had the copy of the slip it recharged my issuer MOP564.30 without reference to A Lorcha.
Unless a Citi Prestige-like offer comes along it'd be more worthwhile for me to use Unionpay in Macau - Unionpay rate is competitive here, no foreign currency translation charge and decent $6/mile earn rate.
Oct 17, 2014 | 4:01 pm
#1242
Original Poster
Join Date: Jul 2009
Location: SJC
Programs: AA, AS, Marriott
Posts: 6,961
Oct 17, 2014 | 9:08 pm
#1243
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
More of an acceptance issue.
My best unionpay earns 1.3 miles per usd (roughly 1.67% if I use a 1.28cpm valuation). Unionpay is usually 1.5% cheaper than fubon visa (below) except in Macau and China where it's 2%
Fubon v/m earns double miles (3.33%) overseas
So it's a wash. I didn't bother pulling out the unionpay in france.
My best unionpay earns 1.3 miles per usd (roughly 1.67% if I use a 1.28cpm valuation). Unionpay is usually 1.5% cheaper than fubon visa (below) except in Macau and China where it's 2%
Fubon v/m earns double miles (3.33%) overseas
So it's a wash. I didn't bother pulling out the unionpay in france.
Oct 18, 2014 | 2:00 am
#1244
Join Date: Sep 2013
Programs: BAEC Silver, Hilton Honors Gold
Posts: 627
Hi FT'ers,
I understand this thread is predominantly about DCC when you are present at the POS but I have a case where this happened to me on an internet purchase.
I booked a hotel with IHG at an Intercontinental property. I have not stayed there yet but it is a prepaid rate and so I cannot cancel it. The reservation was online and the final price was quoted in EUR. When I checked my credit card statement online yesterday I saw that they had performed DCC and charged my card in GBP. I have a credit card with 0% forex fees and a very good exchange rate so the amount was significantly worse than if my credit card provider had performed the conversion. It was nearly 20 more than I was expecting.
I am still waiting for the reservations department of the hotel to get back to me as the front desk agent denied they had performed the conversion and insisted my credit card company must have converted it to GBP.
Does anyone have any experience of this? I am guessing the same rules apply and that they have to have my consent to do the conversion?
Thanks,
Andy
I understand this thread is predominantly about DCC when you are present at the POS but I have a case where this happened to me on an internet purchase.
I booked a hotel with IHG at an Intercontinental property. I have not stayed there yet but it is a prepaid rate and so I cannot cancel it. The reservation was online and the final price was quoted in EUR. When I checked my credit card statement online yesterday I saw that they had performed DCC and charged my card in GBP. I have a credit card with 0% forex fees and a very good exchange rate so the amount was significantly worse than if my credit card provider had performed the conversion. It was nearly 20 more than I was expecting.
I am still waiting for the reservations department of the hotel to get back to me as the front desk agent denied they had performed the conversion and insisted my credit card company must have converted it to GBP.
Does anyone have any experience of this? I am guessing the same rules apply and that they have to have my consent to do the conversion?
Thanks,
Andy
Oct 18, 2014 | 2:22 am
#1245
Ambassador, Hong Kong and Macau
Join Date: May 2009
Location: HKG
Programs: Non-top tier Asia Miles member
Posts: 22,113
Hi AndyRobin
Yes DCC on prepaid rate (Amsterdam). The hotel sent the scalp back as a credit to the card.
Yes DCC on prepaid rate (Amsterdam). The hotel sent the scalp back as a credit to the card.