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ATM to avoid in Florence

When taking money from an ATM machine you have no idea what the machine/bank is going to give as an exchange rate and one rarely sees the exchange rate on the ATM receipt. When I arrived home and went through my bank statements i discovered that a EURONET ATM on Via Taddea 8 near Florence's Central Market charged an outrageous 25 percent exchange rate. I requested 250 Euros and $311.85 was charge to my checking account. (80 Euros for one hundred dollars!) I don't know how to avoid these machines other than to share my experience with others.
Melanie

Posted by
20600 posts

As has been recommended many times on this site, make sure you are using a bank owner ATM. Have no idea who Euronet is? I also try to use an ATM attached to a bank during open hours. That is not always possible but I try. You will not see an exchange rate on your receipt because at the time of withdraw the exchange rate is unknown. The exchange rate is set by the network being used at a later time. Also what fees did you bank add?

Posted by
4468 posts

Euronet corporate HQ is in Leawood Kansas.

Posted by
8889 posts

I think you fell foul of the dreaded DCC (Dynamic currency conversion).
Did the machine ask if you wanted to "pay in own currency"? If it did, the answer should have been "NO, never, be gone from me satan".

The "machine/bank" should not be doing the conversion. What should happen is that the bank owning the machine charges your bank the amount you were paid, €250. Your bank then converts this to the currency of your account (USD 275) and charges you that amount. If they charge you a bad rate, you can go into your bank, rant at them and threaten to change your account.

But, if the machine asks you if you want to be charged in "your home currency", and you answer yes, you are leaving yourself open for the machine owner to charge whatever exchange rate they want.

Never say yes to DCC!

P.S. USD 311.85 = € 284, you were surcharged 13.6%

Posted by
4468 posts

The receipt should indicate whether DCC is involved or not.

Posted by
2 posts

I was charged over $30.00 more than at any other ATM for the same transaction. My bank fee was similar to other exchanges - just a $1.00 more because of the greater amount taken from my checking account. Actually I had no problem with 2 other EURONET ATMs Will remember to use bank machines during bank hours. thanks.

Posted by
4808 posts

Not to confuse the situation....but even "Bank" ATMs may employ DCC, as can some merchants, and there will be some type of indication that it is an option. As has been said, No is the answer or doing the transaction in local currency. An ATM arbitrarily picking an inflated exchange rate without notification will not happen.

Also just for others benefit, being charged $311.85 for 250 euro works out to an exchange rate of ~$1.25. Not sure what the date of your transaction was, but the premium you were charged was closer to ~15% over interbank, typical for a DCC transaction.

Posted by
20600 posts

The foreign bank is not involved in the transaction other than providing cash. The foreign bank does not set the exchange rate. When you use an ATM it first goes through a network - Plus, Cirrus - is the most common (VISA and Mastercard) but there are other networks less common. It is the network that determines the exchange rate by batching all of the transactions over time until a certain point is reach and then that batch is exchange for the prevailing currency rate at that point time. Often referred to as the Interbank rate. This will occur several times a day so the exchange rate in the AM may be slight different than the PM rate. Then that rate plus a small percentage (<1%) is passed along by the network to your bank as the exchange rate. And everyone gets paid. And if a non-bank owned ATM they will add their fees to the amount that is present to the network so that it conveniently gets buried in the transaction.

Posted by
17648 posts

"The foreign bank does not set the exchange rate."

Not if the transaction is made in euro. But, as Chris pointed out, if it is in US$ (DCC) the foreign bank or ATM owner converts the amount in euro into US$. That way, he sets the rate to whatever he wants and bills the Network in dollars. Then your bank adds another 1 to 4 percent per your agreement, even though there was no currency conversion on their end.

When did this happen? Last Jan. 1 (but not since), the rate was $1.214/euro. If your own bank charges 3%, you could have paid $1.25/euro then.