Pay in Pounds or Dollars
Aug 9th, 2016, 06:59 AM
#1
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Pay in Pounds or Dollars
For several things on our England vacation, I can either choose to pay in pounds or dollars when booking things like hotels and tours online. When I look online at the conversion rates, it always appears I would be better off to pay in pounds with my CC than in dollars. Has anyone had any experience with this ?
Aug 9th, 2016, 07:03 AM
#2
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If you a booking ahead of time through a site such a Hotels.com, I would pre-pay in dollars. If booking directly with the hotel, I would pay in the currency of the country in which the hotel is located.
Aug 9th, 2016, 07:14 AM
#4
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If you understand how the businesses work, this should not be a surprise. If you are dealing with UK only business entities, they need to get revenue in Pounds at some point. If they get paid in Dollars, they would need to pay to convert as well as take a risk in conversion rate fluctuations. Why would they want to eat these risks and cost? Besides, further profit margin can be added in the name of "convenience to you."
If you are dealing with an entity whose business is in a dollar denominated country, there can be variations. If you are provided with fixed dollar and pound price tags, the dollar price tag can lag behind the currency change, sometimes in your favor.
I think a key take away is never assume "it always appears I would be better off to pay in pounds with my CC than in dollars." For each major transaction, do a homework. With internet, it takes only a few seconds.
If the price tag is in pounds, but they are giving you a "favor" (ha!) of paying in dollar, they are almost ways adding a margin in their favor.
If you are dealing with an entity whose business is in a dollar denominated country, there can be variations. If you are provided with fixed dollar and pound price tags, the dollar price tag can lag behind the currency change, sometimes in your favor.
I think a key take away is never assume "it always appears I would be better off to pay in pounds with my CC than in dollars." For each major transaction, do a homework. With internet, it takes only a few seconds.
If the price tag is in pounds, but they are giving you a "favor" (ha!) of paying in dollar, they are almost ways adding a margin in their favor.
Aug 9th, 2016, 07:15 AM
#5
It mostly depends on the company -- Some like hotels.com or booking.com -- usually $ is better because you wouldn't pay your credit card currency conversion mark up/fee
But otherwise it is almost always best to pay in £
Hope you aren't pre-paying for a lot of things (like the Eye or the Shard for examples which are VERY weather dependent)
But otherwise it is almost always best to pay in £
Hope you aren't pre-paying for a lot of things (like the Eye or the Shard for examples which are VERY weather dependent)
Aug 9th, 2016, 08:02 AM
#6
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Does your credit card charge a foreign currency conversion fee? If it does not, then you will always be better off paying in pounds. And any time you are asked once you are there, you want to be charged in pounds, as being charged in dollars involved DCC which is a way for them to make money off your currency conversion.
If your credit card charges a foreign currency conversion fee, then it is time to shop for a new credit card. Capitol One has cards that have no foreign conversion fees and Chase has quite number that don't charge the fees.
If your credit card charges a foreign currency conversion fee, then it is time to shop for a new credit card. Capitol One has cards that have no foreign conversion fees and Chase has quite number that don't charge the fees.
Aug 9th, 2016, 08:08 AM
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Yes, you are usually better off paying in the local currency, but if you'd compare, you know that.
First, it isn't true that $ are usually better on hotels.com or booking.com. I'm not sure what the implication is, if it is that you must prepay, that isn't true, you choose the rate, I have never prepaid using booking.com. I don't know about hotels.com because I don't use it.
However, there are plenty of credit cards around without foreign conversion fee markups, I have 3, so that isn't always the case, either. that you have such a thing. And even then, you'd have to know the different markups to compare, credit cards are usually 3 pct and some of those DCC things charge more than that. And also, there are CCs that charge you that markup even if you use DCC and the charge is in USD, if the charge comes from a foreign country.
Prepaying in $ for hotels.com can be beneficial but only because you may get a discount for prepaying, I presume. I've prepaid on some websites but I was still prepaying the hotel, not some booking website, the rate quoted was just converted but in fact, was in euro when charged by the hotel, even when prepaid.
First, it isn't true that $ are usually better on hotels.com or booking.com. I'm not sure what the implication is, if it is that you must prepay, that isn't true, you choose the rate, I have never prepaid using booking.com. I don't know about hotels.com because I don't use it.
However, there are plenty of credit cards around without foreign conversion fee markups, I have 3, so that isn't always the case, either. that you have such a thing. And even then, you'd have to know the different markups to compare, credit cards are usually 3 pct and some of those DCC things charge more than that. And also, there are CCs that charge you that markup even if you use DCC and the charge is in USD, if the charge comes from a foreign country.
Prepaying in $ for hotels.com can be beneficial but only because you may get a discount for prepaying, I presume. I've prepaid on some websites but I was still prepaying the hotel, not some booking website, the rate quoted was just converted but in fact, was in euro when charged by the hotel, even when prepaid.
Aug 9th, 2016, 08:23 AM
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Assuming you bank in the US, you will never want to accept to pay in dollars if the transaction is outside of the US. There are two reasons:
1. you really do not know what exchange rate will used for the dollar equivalency.
2. you will still pay the foreign transaction fees even if the amount is stated in dollars. This ¨feature¨ is included in the small print that your card issuing bank sends you that almost no one reads. Visa/MC did not like losing these fees when merchants started offering the pay with dollars option. Visa/MC changed their card agreements about 3 or 4 years ago to include the fees on all charges outside of the US even if the transaction is in dollars.
1. you really do not know what exchange rate will used for the dollar equivalency.
2. you will still pay the foreign transaction fees even if the amount is stated in dollars. This ¨feature¨ is included in the small print that your card issuing bank sends you that almost no one reads. Visa/MC did not like losing these fees when merchants started offering the pay with dollars option. Visa/MC changed their card agreements about 3 or 4 years ago to include the fees on all charges outside of the US even if the transaction is in dollars.
Aug 9th, 2016, 08:41 AM
#9
If you are <u>prepaying</u> via booking.com which will typically get you a cheaper, non-refundable rate, then $ is just fine. In fact the rates are usually only listed in $. Have no idea what Christina is talking about.
If on the other hand you are just booking through the site and won't pay until you are IN country, you definitely will want to pay in £
And as I posted, for other 'in country' sites it is almost ALWAYS better to pay in £.
If on the other hand you are just booking through the site and won't pay until you are IN country, you definitely will want to pay in £
And as I posted, for other 'in country' sites it is almost ALWAYS better to pay in £.
Aug 9th, 2016, 10:30 AM
#10
I wasn't aware that the OP had said they are "prepaying" or did I miss that part?
If you pay anytime and anywhere in the non-local currency then somebody is going to make the exchange rate determination and I doubt it will be as favorable to you as it would be <B>if your bank/credit card issuer</B> made that decision vs. any merchant.
If you pay anytime and anywhere in the non-local currency then somebody is going to make the exchange rate determination and I doubt it will be as favorable to you as it would be <B>if your bank/credit card issuer</B> made that decision vs. any merchant.
Aug 9th, 2016, 11:58 AM
#12
Always pay in local currency. Obviously this can backfire if you are paying for things well ahead of time and there is a major change in the rate of exchange, but in just about every case the rate for paying "in your own currency" ("dynamic currency exchange") will end up cheating you.
Aug 9th, 2016, 02:44 PM
#13
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<i>I wasn't aware that the OP had said they are "prepaying" or did I miss that part?
</i>
Booking on-line, as mentioned in the original message suggests the possibility of prepaying, depending on the booking agent.
</i>
Booking on-line, as mentioned in the original message suggests the possibility of prepaying, depending on the booking agent.
Aug 10th, 2016, 12:01 AM
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When using a Visa debit or credit card abroad (MasterCard has a similar tool) you can find out exactly what the exchange rate will be at:
https://usa.visa.com/support/consume...alculator.html
You can even plug in the foreign transaction fee if your bank has one. I've found that the conversion rate lags by a day or two, so by watching the forex sites, e.g. xe.com, you can sometimes save a few dollars. For instance, if you observe that the £ has dropped in value and you can wait a day or two to make a credit card purchase, you will get the lower rate.
On the other hand, if you notice the £ has gone up in value and you can make a purchase or ATM withdrawal that same day, you will beat the Visa or MasterCard rate change. In most cases you are going to save only a few dollars, but if you are about to make a large transaction it is worth tracking the rates.
https://usa.visa.com/support/consume...alculator.html
You can even plug in the foreign transaction fee if your bank has one. I've found that the conversion rate lags by a day or two, so by watching the forex sites, e.g. xe.com, you can sometimes save a few dollars. For instance, if you observe that the £ has dropped in value and you can wait a day or two to make a credit card purchase, you will get the lower rate.
On the other hand, if you notice the £ has gone up in value and you can make a purchase or ATM withdrawal that same day, you will beat the Visa or MasterCard rate change. In most cases you are going to save only a few dollars, but if you are about to make a large transaction it is worth tracking the rates.
Aug 10th, 2016, 03:04 AM
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Let me say my experience although I don't want to say that the general advice to use local currency is wrong.
This past summer, I planned a cruise out of Barcelona but wanted to visit Paris too. So I booked my trans-Atlantic flight to Paris and scheduled to take the train to Barcelona to check out the TGV. After much hesitation, I decided to go on the morning of the cruise as to me the SNCF TGV has over a 95% on time arrival record. Fine. But little did I expect the floods that hit Paris as well as the SNCF strike. The best price I could get for tickets was from a UK travel agent specializing in train travel. I had my choice to pay in USD or UK£. The later saved me a couple of bucks so I chose it.
Now on Thursday evening, I was informed my early morning train was a casualty of the SNCF strike and the floods. No other train would get me to Barcelona on time. Thank goodness for smartphones. I was able to arrange a last minute flight to BCN at a price somewhat higher than the train fare but not too bad. Getting to CDG from Gare du nord via the RER turned out to be a hassle too but it all worked out. But what about the train ticket?
When I got home I contacted the UK travel agency and they assured me the ticket would be refunded but it would take a couple of weeks. But guess what happened in the interim? Brexit. And the UK£ fell from $1.43 to $1.31. Guess who got screwed. Of course currency fluctuations are a part of the international currency game and a decrease of this magnitude is very rare but it happens. Just something to be aware of.
(And of course it drove home the point not to travel for a cruise from outside the origination point on the day of which I knew was inadvisable but the SNCF is over 95% reliable. Right? Ha ha.
On a side note, don't be surprised if you use booking.com that your credit card will be compromised. The last couple of times I have used booking.com, I use a different credit card than I usually do for my everyday spending and the card has been compromised. Not a big deal but be aware.
This past summer, I planned a cruise out of Barcelona but wanted to visit Paris too. So I booked my trans-Atlantic flight to Paris and scheduled to take the train to Barcelona to check out the TGV. After much hesitation, I decided to go on the morning of the cruise as to me the SNCF TGV has over a 95% on time arrival record. Fine. But little did I expect the floods that hit Paris as well as the SNCF strike. The best price I could get for tickets was from a UK travel agent specializing in train travel. I had my choice to pay in USD or UK£. The later saved me a couple of bucks so I chose it.
Now on Thursday evening, I was informed my early morning train was a casualty of the SNCF strike and the floods. No other train would get me to Barcelona on time. Thank goodness for smartphones. I was able to arrange a last minute flight to BCN at a price somewhat higher than the train fare but not too bad. Getting to CDG from Gare du nord via the RER turned out to be a hassle too but it all worked out. But what about the train ticket?
When I got home I contacted the UK travel agency and they assured me the ticket would be refunded but it would take a couple of weeks. But guess what happened in the interim? Brexit. And the UK£ fell from $1.43 to $1.31. Guess who got screwed. Of course currency fluctuations are a part of the international currency game and a decrease of this magnitude is very rare but it happens. Just something to be aware of.
(And of course it drove home the point not to travel for a cruise from outside the origination point on the day of which I knew was inadvisable but the SNCF is over 95% reliable. Right? Ha ha.
On a side note, don't be surprised if you use booking.com that your credit card will be compromised. The last couple of times I have used booking.com, I use a different credit card than I usually do for my everyday spending and the card has been compromised. Not a big deal but be aware.
Aug 10th, 2016, 07:54 AM
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What do you mean by having your credit card "compromised"? I've been using booking.com for years, most recently within the last month, and never had a problem. If there was a security problem, it most likely was with the hotel, not booking.com .
Aug 10th, 2016, 08:16 AM
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<<Let me say my experience although I don't want to say that the general advice to use local currency is wrong.>>
Instead, you'll imply using the local currency is wrong even though you were caught up in extenuating and unpredictable circumstances due to the strike, and made the less steady choice when confronted with the possibility that the Brits would vote to escape the clutches of the EU.
Instead, you'll imply using the local currency is wrong even though you were caught up in extenuating and unpredictable circumstances due to the strike, and made the less steady choice when confronted with the possibility that the Brits would vote to escape the clutches of the EU.
Aug 10th, 2016, 09:13 AM
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Big Russ...I tried to make as clear as possible, I was not questioning the advice to use local currency and tried to make clear, as you said, these were very rare circumstances. I thought I was very clear on that. If not, I apologize.
Aug 10th, 2016, 09:17 AM
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bvlenci...my credit card information was stolen somewhere between giving the cc information and getting home. Somebody tried to use that card information to clone my card. Amex picked it up and denied the charge. While it could have happened either with booking.com or at the hotel level, those are the only places as I only use that card to make the reservations. Yes it's possible it was compromised ar the hotel but so what. Credit cards being compromised is an every day occurrance today and is not identity theft. A phoe call or two and within a day, I have a card with a new number and no hassles in the slightest. Just pointing it out.
Aug 10th, 2016, 09:38 AM
#20
Having your card compromised while traveling is a big deal. I travel for months at a time and having a new card sent to my house is useless. It's true I travel with more than one card, but I still don't want to lose the use of one of them.
