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Any recent stories of dynamic currency conversion?

Any recent stories of dynamic currency conversion?

Old Jul 30th, 2006, 11:47 AM
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I just wonder how many people know off hand "the rate (they) agreed to when (they) signed up".

And I'm almost positive that a credit card company could change it on you fairly easily mid-stream.

I would guess that most people on this board don't look too hard at the overseeas currency exchange transaction fee when deciding what credit card to sign up for initialy.

Sure, it may be as little as 0% -- but it could also be very high.

I may have missed the point on DCC -- my only point is that the credit card companies aren't necessairly your friend.
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Old Jul 30th, 2006, 11:53 AM
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<I may have missed the point on DCC -- my only point is that the credit card companies aren't necessairly your friend.>

You know how credit cards companies tack on extra fees? As much as 3%? Naturally they aren't your friend.

Well, DCC adds on an additional 3% on top of that -- that's the point.

So, 6% on a credit card purchase could mount up to quite a bit.
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Old Jul 30th, 2006, 12:32 PM
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It could also be that the card which says they don't charge any foreign currency conversion fees is making money by giving a poorer exchange rate.

This has been raised as a distinct possibility more than once.
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Old Jul 30th, 2006, 01:03 PM
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Dukey, how could that be? If they don't charge any foreign conversion fees, then they make the exchange at the interbank rate. I'm assuming that would be the best exchange rate. You must be referring to other bank charges, which a lot of banks tack on.
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Old Jul 30th, 2006, 01:09 PM
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Capital One is the bank that charges nothing on foreign conversions using the interbank rate and eats the 1% visa charge...I suppose they don't make money on this and hope this entices people to use their card more for non foreign transactions.....
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Old Jul 30th, 2006, 01:26 PM
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Or foreign transactions, for that matter. They still gig the merchant for their pound of flesh, after all...
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Old Jul 31st, 2006, 12:50 AM
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That's a good question -- who gets the DCC money? I wonder how it is divided?

It seems like most small merchants are pretty clueless about it. It's not as if the mom-and-pop restaurant I went to in Dublin is nefarious.

Come to think of it, I would rather have them get 6% of the transaction than give my credit card company 3%!
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Old Jul 31st, 2006, 05:10 AM
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Hey, scurry! <b>[i]</b> doesn't work. <b>&lt;i&gt;</b> does.
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Old Jul 31st, 2006, 05:20 AM
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Better the Devel that doesn't rip me off and pretend it is dong me a favor, scurry.

Keith
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Old Jul 31st, 2006, 06:05 AM
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Keith -- your description could fit the credit card company as well!

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Old Jul 31st, 2006, 07:03 AM
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No, The credit card company charges a fee it fully discloses. The merchant is being flat out dishonest. AND charging much more.

Keith
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Old Aug 20th, 2006, 04:23 PM
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It happened to me again in Belfast at the Jury's hotel even <i>after</i> I asked for the final bill to be in sterling.

The clerk tried to explain to me that the dollar amount was just an estimate. When I pointed out that it said &quot;customer agrees to pay in USD&quot; in the fine print, she said oh and ran to get her manager to do the refund and re-charge.

She wasn't trying to pull anything -- she just wasn't trained well.
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Old Aug 24th, 2006, 06:05 AM
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My husband and I recently experienced DCC in Luzern, Switzerland. The hotel we were staying at was Romantick Hotel Wilden Mann.

We stayed at a total of 8 different hotels and B&amp;B during our trip and this was the only time this happened.

We went to check out and the lady at the front desk gave us the bill in U.S. Dollars. The USD amount came to $640. My husband caught it and asked if she could charge us in Swiss Francs. She said that she had already run the transaction. We asked her to cancel it and rering it in Swiss Francs. She said she wasn't sure if she knew how to cancel the first transacation. She finally did as we asked and gave us the bill in Swiss Francs.

A few days later my husband and I looked at our statement and the USD amount that was converted from the Swiss Francs was $580.00. Romantik Hotel Wilden Mann would have made around $60.00 off of us if we had not caught it.

The funny thing was ... she said most Americans liked to be charged in USD so that they knew what they were spending.
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Old Aug 24th, 2006, 06:42 AM
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&quot;...most Americans liked to be charged in USD <s>so that they knew what they were spending</s> because they can't multiply the SFR amount times the exchange rate.&quot;
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Old Sep 6th, 2006, 03:28 AM
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i was travelling in aus recently . i was on a couple of the airine sites , all offer choice between currency . also i read that the fee applied replaces the fx fee that visa applies . so 3% applied . this was also confirmed by visa - so better off knowing what its gonna cost in my home currency . also heard that visa and tha card banks can charge up to 7% depending on the currencies being exchanged - dcc on line seems to be a good thing in my op .
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Old Sep 6th, 2006, 03:38 AM
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...it depends on the credit card you are using, its own policies, and the rate they are using.

My visa card, a US card from Capital One, uses the interbank rate with nothing added on not even the 1% visa charge so obviously paying 3% for a dcc transaction is idiotic on my part...I can use a calculator to figure out what it is costing me and I can check the web site the next day to know exactly what it cost me.

Some near criminal banks impose a 3% (Chase now imposes a 3.5% charge) on all foreign transactions even those where you have been conned into using dcc with the lies that this spares you from the cc fees...and they never tell you just what rate they are using so it is very possible that by using dcc you will be charged 5% above the interbank rates as these dcc processors do not tell you how they determine the rates and then your credit card issuer adds on 3% anyway making the transaction cost you 8% above interbank for the knowledge of knowing just what the transaction is costing.

Give me a break....using dcc is never a good idea and don't let these merchants throw out their lies at you...insist the charge be written in local currency and don't take no for an answer...they have no right to do it without your permission.
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Old Sep 6th, 2006, 05:12 AM
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xyz123 ,

Sounds kinda complicated to me . Perhasps you can explain to me .

do credit card schemes add a charge for fx transactions ?

do they get this charge if DCC happens ?
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Old Sep 6th, 2006, 05:57 AM
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When you use a credit card in a foreign currency transaction, the actual conversion is done by the visa/mc processing center and then sent off to your local bank...they use the interbank rate and add 1% for the service which is fair.

Not to be outdone, seveal near criminal banks (and I'm talking about what goes on in the US) now add additional fees even though they have nothing to do with the conversion..it is done for them by visa or mastercard. The usual near criminal fee is 2% by such near criminal banks as Bank of America, Citibank...Chase now charges an additional 2.5% so for foreign currency transactions if your cc is issued by Bank of America or Citibank, you pay 3% above interbank, with Chase you pay 3.5% above interbank.

Some more consumer friendly banks such as USAA simply pass along the 1% visa/mc fee and so you pay 1% above interbank rates. Capital One, the good guy in all this, absorbs the 1% visa/mc fee and you pay the exact interbank rate...(note the interbank rate is the rate listed in the newspapers the rate banks use to exchanges millions between themselves on a given day)...so far so clear.

When you exchange cash, you generally pay 8% to 10% above the interbank rate so obviously even if you use one of the near criminal banks for your credit cards, you do far better with a credit card.

Now along comes dynamic currency conversion...a cancer metastasizing throughout the world....the credit card processor sets a rate and it usually is 5% above the interbank rate...the merchant is paid in local currency and through the use of 21st century technology, the charge enters the international credit card system in your home country so you pay the exact rate listed on the charge slip you sign....5% is not as good as nothing with Capital One and 3% you pay with the near criminal banks. What happens to this extra fee?...why it is shared by the merchant and the credit card processor of course.

Not to be outdone, seeing that they were losing some of their fee income, many of the near criminal banks such as Bank of America, Citibank, now have decided to charge the 3% anyway even if the charge is done thrugh dynamic currency conversion...thus if you use one of these banks and you are stupid enough to fall for the dcc scam, you pay an extra 5% for the &quot;certainty&quot; of knowing just how much something is costing you and then an additional 3% to the credit card company for a total of 8%.

Somehow this is not too much of an advantage to know exactly how much something costs, don't you agree.
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Old Sep 14th, 2006, 02:56 PM
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Since I go back once or twice a year, I was thinking of opening a bank account with Bank of Ireland. Then I could deposit money in there throughout the year and have an Irish Laser Card to use while there and not deal with the whole conversion issue. Anyone else do that?
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Old Sep 14th, 2006, 03:01 PM
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&quot;Capital One, the good guy in all this, absorbs the 1% visa/mc fee and you pay the exact interbank rate...&quot;

I'm glad you believe that but in my own experience comparing my Cap One charges made in Europe with comparable charges made with a CC that passes on the &quot;foreign exchange fee&quot; the Cap One charges definitely reflected a poorer exchange rate.
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