The previous normal was to charge in Dollars on no conversion fee CC. Mid May travel days in Barcelona and surrounding Catalonia 50% of merchants were refusing to have charge in dollars. Reviewing charges. The following is noted when charge is in dollars : 1) Commercial Global Payments: Mark up 2%. 2) I have chosen not to use the MasterCard currency conversion process and agree I will have no recourse against MC concerning the conversion or its disclosure. This message is found on Sabadell, BBVA, Bankia, Targo Bank and Renfe. The current 30 day conversion dollar to euro was a range of 0.88159-0.89840. The conversion by the listed banks were 0.85357-860101. Spoke with Capital One which stated they were aware foreign banks were charging a conversion fee for dollars to euros. There is a charge from foreign banks for converting dollars to euros. I have asked Capital One to get the information out to their customers.
This is Dynamic Currency Conversion (DCC). It has been around for years now. It is never a good option as there is the mark up in favor of the merchant. Transactions were always charged in local currency if DCC was not used. You would never see anything but the dollars on your credit card statement because the network converted the local currency (Euros) into dollars. Simple solution: never let a foreign merchant or ATM charge you in dollars.
EDIT: The foreign bank charge is for converting Euros to Dollars, not the other way. This only happens if you choose to be charged in dollars.
I was in Spain in March, and again in May. I used my CC which does not charge foreign transact fees and asked to be charged in euros. Worked perfectly. I don't understand why the OP was asking to be charged in dollars.
I don't understand it either. I don't want to see the $ conversion until it hits my CC monthly statement. We always want the purchase in local currency.
I agree with the previous comments -- since when is it 'normal' for a credit card to be charged in US $ when buying something in Barcelona? If the price tag says 18 euros, I expect to be charged 18 euros.
Yeah I can’t imagine asking a local merchant to charge you in dollars could be preferable to just letting them charge you in the local currency, and letting the card network handle conversion.
There are two likely costs when letting yourself be charged in the local currency:
- Associated card issuer fees (a foreign transaction fee, either flat or a percentage; check with your card issuer for what those are).
- The card network exchange rate. This isn’t a fee per se, but can nonetheless cost you something. This is usually not too significant an amount, though. In essence, if (for easy math’s sake) it was 2 USD to 1 Wallachian Widgey, MasterCard or Visa might convert that for you at 1.99 USD or 1.98 USD to 1 Widgey. MasterCard and Visa post their exchange rates though, so you can see what you might be getting on conversions. Either way, I’m sure they’ll exchange at a better rate than any DCC offering.
I missed the memo to charge in local currency (DCC). I understand I made a mistake to charge in dollars. I will keep up on changes in the future.
I don't think it's ever been a good idea to be charged in anything but the local currency, so the place you got that information should be ignored in future.
Just saw your title change. You want to AVOID DCC.
Helpful for anybody confused about DCC:
I never ask to be charged in $, why should I? Also, when paying I don't ask to be charged in Euro. Since I don't say anything, I know I'll be charged in Euro anyway. I use a Capital One credit card in Europe also but sparingly.
Sometimes the merchant will choose DCC but that must be disclosed on the form you sign -- I got caught on that once in Prague when I couldn't find my glasses to read the fine ptint before signing.
It is unfortunate that so.wolf did not get the memo about DCC before traveling.
We knew to avoid it but had an unfortunate experience with it last month. We were in a small market in London and my husband wanted to a make a £39 purchase at booth where the owner would only take cash. We did not have enough ( departing the next day) so asked about a cash point. The vendor pointed us to a cash machine inside the market that " does not charge taxes". Right. We did not find out until the transaction was complete that the machine charged an exchange rate of $ 1:46 per £ instead of the official rate of $1.26. Fortunately it was only only £50.
I once had the checker at a corner grocery reach around to my side of the credit card device to choose dollars. It happened in Warsaw, across the street from the RS-recommended Chopin Boutique B&B. I've also had restaurant and hotel staff make the choice for me (in Hungary and Spain). I don't take kindly to that, and I am not quiet about it. I usually refuse to sign the charge slip, no matter how vociferously they insist they don't know how to cancel the transaction. From these experiences I have learned never to wait until the morning of departure to settle a hotel bill. If your train leaves in half an hour, you don't have much time to stand around and argue. The offending personnel will drag their feet, trying to wait you out, no doubt per the instructions of the hotel owner/manager.
In better news, I have been in France for about 3 weeks, and there has been no DCC funny business. One ATM did offer it as an option, but you just have to decline it. Perhaps I have been lucky in the hotels and restaurants I have hit so far, so I am still on my guard.
Similar to experiences by acraven, in Spain a couple years ago, it was a struggle to hold onto the credit card reader (I was using a PIN card, so had to enter my PIN) long enough to get to the DCC question. Most times the staff would reach for it as soon as I entered my PIN, I had to indicate I was not done yet. I did not get the sense that they were trying to force DCC, just that they do not see questions with their normal transactions, and to be honest, they could probably care less how the transaction goes through. Additionally, who knows, they may have been told we like to charge in Dollars.
A lot of people do like to choose dollars. There are some people who just can't or won't understand foreign currency and want to know what it costs in "real money", For them, the convenience of DCC is worth it. I've seen people choose it just because they didn't really understand it, and only heard the familiar word "dollars". So maybe that happens often enough that the merchants just assume you will in order to speed up the transaction.
Admittedly, the very first time encountering this DCC had me pause a while. It was in Vienna ca. 10 years ago paying with the credit card checking-out from the hostel.
In the end I didn't go for the DCC since I figured it was a trick and didn't want to deviate from the Euro payment.
I have been in France for about 3 weeks, and there has been no DCC funny business.
Yes, I don't think I've ever been offered DCC by a merchant in France, right up to last month's trip, although the option has frequently popped up at ATMs. On the other hand, on my recent visit to Switzerland I was given the DCC option several times. The only time I have ever selected it was by accident at the Dublin airport a few years ago. I wasn't paying attention, but since it was just for a couple of beers, it was inconsequential.
it was a struggle to hold onto the credit card reader (I was using a PIN card, so had to enter my PIN) long enough to get to the DCC question. Most times the staff would reach for it as soon as I entered my PIN, I had to indicate I was not done yet
I am slightly confused by Paul's comments here.
In my memory, entering your PIN is the final action to confirm the transaction (same as entering your credit card on a website).
The machine displays the amount, you put in your PIN to confirm the transaction amount, i.e. DCC is before the PIN. You can see the amount and currency.
If the staff get awkward, I get stubborn: "I have offered to pay you the amount on the bill, you have refused to accept my payment. If you won't accept my money I have no further obligation to you, I am walking".
The choice can be given after the PIN has been put in which is why it is important to keep any hand hold device out of the possession of the shop until the transaction has been completed.
Folks using the vast majority of US credit cards are not promoted for a PIN (except at some vending machines, etc.). I think I'm usually asked to confirm the amount shown in the local currency, then there's a separate screen that attempts to persuade me that I should conduct themtransaction in dollars instead. The DCC bit comes last unless there's a prompt asking whether I want a copy of the receipt.
just recently had lunch in a well know Tea room in London. The credit card receipt was converted to $ without my consent. We know the drill bout bad conversion rates. When I asked to have the bill revised to £ I was first refused but when I insisted a refund credit was issued to my card then a new bill in £ was presented.
Here is the tricky part. The refund credit was issued in £, which my card duly converted (no fee, just the currency conversion
rate) to $ using the more favorable rate. The net effect was a loss to me due to the difference between the "Tea Room rate" and my "card rate". The lesson here is to insist, before handing over your card, that you want the bill in native currency (£ in this case). Failing this, insist that any charges in $ be reversed in $ so the same conversion rate will yield a full refund.