Article: Why is Dynamic Currency Conversion Even Legal?

[AFF Editor]

Why is Dynamic Currency Conversion Even Legal? is an article written by the AFF editorial team:

Why is Dynamic Currency Conversion Even Legal?

Most countries ban junk surcharges like "resort fees" because they can trick people into paying more and are bad for consumers. So, why is dynamic currency conversion (DCC) is still legal?

www.australianfrequentflyer.com.au

You can leave a comment or discuss this topic below.

 

[marki]

Quote: "Some banks argue that dynamic currency conversion is more convenient for customers because they'll know exactly how much they are paying in their home currency at the time of the transaction. Perhaps you could argue that some business travellers prefer this because they'll immediately know what amount to expense without checking their bank statement later. But this "convenience" comes at a cost."

That is the biggest laugh of my life. Thank you, bank ATM. I will now know I am overpaying, but at least I know the exact overpayment amount. What a relief!!!!

It makes my day - Coffee time - wait, where is my 6.50 Euro gone?

 

[kpc]

Hilton KL automatically tried to charge me in AUD when I settled the bill....I refused to sign, asked them to cancel the transaction, and recharge me in Rimggit...I gave them a polite lecture why I had done so...the staff member had no idea about the increaaed cost of DCC, and clearly must have been instructed to do so.

 

[AIRwin]

Did you end up initiating a chargeback to TAP?

 

[MEL_Traveller]

Quote: "Some banks argue that dynamic currency conversion is more convenient for customers because they'll know exactly how much they are paying in their home currency at the time of the transaction. Perhaps you could argue that some business travellers prefer this because they'll immediately know what amount to expense without checking their bank statement later. But this "convenience" comes at a cost."

That is the biggest laugh of my life. Thank you, bank ATM. I will now know I am overpaying, but at least I know the exact overpayment amount. What a relief!!!!

It makes my day - Coffee time - wait, where is my 6.50 Euro gone?

Must be the same PR firm for the banks as the airlines… who claim an EU-type compensation scheme in Australiamwould be ‘too confusing’ for customers!

Back to the article… 6.5% margin in the example. Many cards already charge a 3.5% foreign transaction fee, so maybe some people think it’s not that much more? And people with travel cards may not want to convert their money twice if they don’t have enough funds in the local currency.

There are lots of traps… foreign currency booths at the airport, the Thai ATM foreigners fee…

 

[SYD]

It would be interesting to know if it IS banned in some countries? I notice that my 28° MC regularly triggers DCC in some countries but not others.

It’s very common in Spain for example but you don’t always see it so presumably it’s a function of the type of POS terminal in use? A friend of mine is taxi driver in Barcelona, he was just telling me that he gets a share of DCC even though he advises his passengers that they’re better off paying in Euros…

Regarding online purchases - there are other examples that aren’t DCC but equally annoying. You’re quoted AUD at what seems like a good exchange rate and pay with a regular CC / DC, only to be slugged a 3% int tx fee because there’s a conversion happening in the background and the underlying currency transaction is still USD or Euro etc but you only ever see AUD amount on your statement plus 3%.