Article: Why is Dynamic Currency Conversion Even Legal?

[Lynda2475]

Some may view the fact that you see the purchase price in their home currancy as a benefit, regardless of cost!

Except that it's not a true representation of the cost in their home currency but rather one that is inflated by 3-7%, 3-7% they wouldn't pay if they opted out of DCC.

 

[SYD]

Except that it's not a true representation of the cost in their home currency but rather one that is inflated by 3-7%, 3-7% they wouldn't pay if they opted out of DCC.

Over 10% if they use a card that usually charges 3%.

The earlier example was actually 13% albeit on NZ$1 but $130 extra on a $1k hotel stay would otherwise buy a nice meal…

 

[Beano]

Over 10% if they use a card that usually charges 3%.

The earlier example was actually 13% albeit on NZ$1 but $130 extra on a $1k hotel stay would otherwise buy a nice meal…

That wasn't DCC and 10% was currency conversion AUD to NZD, so only 3% charge.

 

[SYD]

That wasn't DCC and 10% was currency conversion AUD to NZD, so only 3% charge.

What on earth did you use to get that sort of cough forex?

 

[RooFlyer]

The business selling the goods/service you buy OS does not benefit from DCC, they get the base amount that was rung up at check-out.

Of course they do; else why bother? - see the post #42 by business owner Restless here.

 

[Lynda2475]

Over 10% if they use a card that usually charges 3%.

True but they would have aid that 3% with or without DCC.

 

[SYD]

True but they would have aid that 3% with or without DCC.

Yes, as I’ve and others have said, it’s those who have a CC or DC that they know charge 3% might think paying in AUD is saving them money - until they look online or get their statement…

They’d be better off getting a Travel Money card (and they’re pretty coughpy - in general - but better than DCC).

 

[Beano]

They’d be better off getting a Travel Money card (and they’re pretty coughpy - in general - but better than DCC).

I agree. My wife won't let me use a credit card in Spain or Italy so we use a Travel Money Card. For some reason Germany is OK.

 

[kangarooflyer88]

Some may view the fact that you see the purchase price in their home currancy as a benefit, regardless of cost!

Which would be fine if the price you see at the terminal is the price you pay. Sadly many cards will apply a surcharge on top even if you were billed in home currency

 

[Beano]

Which would be fine if the price you see at the terminal is the price you pay. Sadly many cards will apply a surcharge on top even if you were billed in home currency

Double whammy then! Even more reason to use the local currency.

 

[VPS]

I find it very clunky - XE still handier as all the currencies you use are already there.

Totally agree - needs a bit more work to make it easier than xe

 

[Beano]

What on earth did you use to get that sort of cough forex?

The NZD is at a low against the AUD! The buy and sell rates are different. If you buy something in a foreign currency then get a refund, you loose out because of that.

 

[bernardblack]

The ACCC should absolutely not be let off the hook for punishing Visa when Visa discouraged DCC. It's one more instance where the Australian regulation has intervened to make credit cards materially worse for Australian customers, just as when they forced Visa and MasterCard to get rid of their no-surcharge rules which (predictably) led to increases is surcharging.

 

[Mattg]

I was paying the bill at a restaurant in Lisbon yesterday and the EFTPOS terminal gave me the option to pay in EUR or AUD (the latter with a 6.5% markup). I selected EUR, and the terminal then went to a second screen that said “Card issuer will convert currency”, followed by the options “Accept conversion” and “Reject conversion”.

I had already selected to pay in EUR, so it made no sense why I was then being given a second option to accept or reject conversion, and honestly the question didn't even make sense either. I told the waiter that I wanted to pay in EUR, and he also wasn’t sure which one I should select in order to do so. He agreed the wording made no sense and was confusing.

Since I’d already selected EUR, I assumed that the message on the screen was asking if I accepted that my bank/card issuer would do the currency conversion so chose “Accept conversion”. And sure enough, the terminal then charged me in AUD with a markup.

One of the things I really dislike about DCC is that generally the only people who agree to it are people who don’t understand what it is or are tricked into it. This was a case of the latter as I definitely knew what it was but the way it was implemented on that payment terminal was frankly deceptive.

 

[moa999]

I believe China has gotten better (and less CCs generally with WeChat and Alipay) but in the early days of DCC China was the wild west, with some machines making it very difficult to select RMB.

Using Credit Cards in China - The Great CC Rip Off (dynamic currency conversion) - FlyerTalk Forums

China - Using Credit Cards in China - The Great CC Rip Off (dynamic currency conversion) - Using Credit Cards in China - The Great CC Rip Off (dynamic currency conversion) This thread aims at helping those using CC's in China to avoid and bust the DCC Scam in China. If you use CC's in China, you...

www.flyertalk.com

 

[bernardblack]

I was paying the bill at a restaurant in Lisbon yesterday and the EFTPOS terminal gave me the option to pay in EUR or AUD (the latter with a 6.5% markup). I selected EUR, and the terminal then went to a second screen that said. “Card issuer will convert currency”, followed by the options “Accept conversion” and “Reject conversion”.

I had already selected to pay in EUR, so it made no sense why I was then being given a second option to accept or reject conversion, and honestly it made no sense what the question was asking. I told the waiter that I wanted to pay in EUR, and he also wasn’t sure which one I should select in order to do so. He agreed the wording made no sense and was confusing.

Since I’d already selected EUR, I assumed that the message on the screen was asking if I accepted that my bank/card issuer would do the currency conversion so chose “Accept conversion”. And sure enough, the terminal then charged me in AUD with a markup.

One of the things I really dislike about DCC is that generally the only people who agree to it are people who don’t understand what it is or are tricked into it. This was a case of the latter as I definitely knew what it was but the way it was implemented on that payment terminal was frankly deceptive.

Yes, the terminal and ATM prompts are in many cases clearly composed to intentionally further confuse the issue and trick even savvy users into accepting DCC against their will.

Post automatically merged: Yesterday at 9:46 PM

For the record I think you should dispute this with your issuer, Matt.

 

[Lynda2475]

I was paying the bill at a restaurant in Lisbon yesterday and the EFTPOS terminal gave me the option to pay in EUR or AUD (the latter with a 6.5% markup). I selected EUR, and the terminal then went to a second screen that said. “Card issuer will convert currency”, followed by the options “Accept conversion” and “Reject conversion”.

Messaging on terminal in Auckland was the same 2 weekends ago, I selected NZD (instead of AUD) and then Reject Conversion and I was not hit with the DCC on that occasion.

But i agree its misleading; and I would definitely lodge a complaint. But you need to treat the second question as an are you sure.

 

[moa999]

Personally with those choices.. the card issuer (is the AU bank/fi) who you want to do the conversion, so I would be choosing Accept as @Mattg did.

 

[Lynda2475]

Unfortunately it wasn't Matt's card issuer asking the question, its the terminal provider. In raising the dispute, Matt's bank will likely need to request refund form the terminal provider; or waive their fee in an act of goodwill.

Like I said earlier, the easier things would be able to have an opt-out card setting that pre-declines DCC in all circumstances, so users were not even prompted with such misleading nonsense.