Restaurants converting euros to USD

Old May 20th, 2005, 05:21 PM
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The same thing happened to us in Italy about 2 weeks ago. We had been paying for everything in cash. However, this one night at a restaurant we were short on cash and used VISA. The final bill was brought to us in US dollars at a very inflated rate of exchange.

However, I had been informed about this practice and told that if I ever encountered it to refuse to sign the charge receipt and insist on being charged in Euros.

The waiter told me that they do this for all of their American customers and that "most of them appreciate this convenience."

However, I wasn't buying this deal. When I told them I wanted a bill in Euros they told me it was too much trouble to cancel this transaction in dollars and write out a new one in Euros. But I insisted. The charge slip said something like: "I agree NOT to be charged in Euros" and I told the waiter I was NOT going to sign it.

Finally, they agreed to cancel the transaction in dollars and do it over in Euros.

When I returned home I found an article in the Miami Herald reporting that this is becoming a widespread practice for businesses to make an extra profit in the exchange rate.

According to the Miami HErald: "Merchants in foreign countries may charge a currency conversion fee equal to 2.5 percent to 3 percent of the purchase amount if the cardholder agrees to denominate the charge in US dollars instead of local currency."

The Miami Herald advises cardholders to refuse this as they will get a better deal on the exchange rate from their credit card company.
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Old May 20th, 2005, 05:36 PM
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Yeah that "it's too much trouble to cancel the transaction" is one of the lies they tell....on any credit card terminal there is a button to cancel any transaction.

Again it is almost universal in Ireland now and spreading like wild fire in Italy. As long as we are all aware of this, they won't get away with it.

Incidentally, is there anybody out there who really appreciates knowing what the charge is in their currency knowing full well this courtesy is costing you around 5%?????
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Old May 20th, 2005, 07:15 PM
  #23  
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walkinaround-
"maybe perhaps now in euro also as this is challenging USD as THE hard currency worldwide."

I am young and uninformed and sort of an airhead- what does that mean?
 
Old May 21st, 2005, 01:20 AM
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MalTru -

As explained in my post, in many less developed nations with weak and unstable currencies it is common for internationally orientated businesses to price things in "hard" currency rather than local currency. Forever, that "hard" currency was US$. Whilst the USD still maintains this position, the euro is slowly inching in on USD's turf as the worldwide hard currency of choice.
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Old May 23rd, 2005, 07:00 PM
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Just got back from Ireland, they are setting up a department this week to look out for merchants cheating tourists. They can close them down on the spot. Ask about using Credit Cards prior to ordering, if paying in US $ ask if you will get US $ in change. I found that a lot of places will accept Euro, US or pounds, ask if in doubt. I found best exchange rate at hotels. Didn't convert to pounds at all, most took cash or US. Have a good trip.
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Old Jun 8th, 2005, 08:08 AM
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I just returned from Ireland and more often than not, they'll try to convert to Euro. One restaurant would not change it and I wrote below my signature that I requested Euro. I haven't seen my credit card statement to dispute it yet, but I intend to. I would suggest that before you incur a charge, tell them you want to be charged in Euro and if they don't agree, leave. That's what I will do in the future.
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Old Jun 8th, 2005, 09:49 AM
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tom, what do you mean, they will try to convert to Euro? The Euro is the official currency of Ireland, isn't it, so no conversion is necessary. Did you mean they try to convert euro to something else?
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Old Jun 8th, 2005, 10:15 AM
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If you use MasterCard,and this happens to you MasterCard wants to hear about it.If enough of us complain about DCC to them maybe they will find a way to stop merchants abusing this practice.

The number to call to report this is
1-800-300-3069 M-F 8-4:30CT It helps if you have the date.the merchants name,and the reference number for the transaction that appears on your statement.
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Old Jun 8th, 2005, 10:34 AM
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Thanks for posting that number. I have two receipts from vendors in Sorrento, Italy where I was given a receipt in euros, then they proceeded to charge my mastercard in dollars at a much higer rate than the true exchange rate. It was only $2 or $3 because my purchases were small, but the principle really irks me.

Does anyone know to whom I should write at the Italian government (i.e., Tourist Board, Consultate, ???). Writing a letter complaining about merchants ripping off tourists this way will only take me a few minutes but if it might help stop this practice it is well worth it!
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Old Jun 8th, 2005, 10:45 AM
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Here is what I would do...

1. E mail the merchant telling them they are in violation of (fill in the credit card name) regulations by not giving you the choice of whether or not you wanted to be subject to the near criminal dynamic currency conversion and request the charge in USD be immediately credited and a charge in euro be submitted.

2. Failing that I would write to your credit card issuer demanding the charge be charged back to the merchant account as, in accordance with (fill in the name of the credit card), you were not given a choice as to whether or not the charge would be subject to the near criminal dynamic currency conversion.

I would include in both a statement o the effect that the terminal, before completing the charge, asks if the customer wishes to accept dynamic currency conversion and by their answering yes without asking you is commiting fraud and is a criminal act.
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Old Jun 8th, 2005, 10:51 AM
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Here is why merchant want to pull this near criminal activity from a brochure trying to get merchants in the US to sign up for this garbage:

Dynamic Currency Conversion
Money in your pocket for every foreign cardholder transaction!
Every time a customer with a Visa or MasterCard issued by a foreign bank makes a transaction at your establishment a fee (approximately 3%) is charged to the customer by their issuing bank. For example, say a British cardholder dines in the US and is charged $100 for a meal. That charge actually becomes $103 before it is converted to his native currency, Pounds Sterling. Currently, that additional 3% goes to the card associations (Visa/MasterCard) and the cardholder's issuing bank, which handles the funds transfer. But $$$ ON THE NET, now with Dynamic Currency Conversion (DCC), is about to change all that.

Dynamic Currency Conversion (DCC) is a new functionality in $$$ ON THE NET that Shift4, in conjunction with our DCC partner Planet Payment, is offering our merchant customers. With DCC you, as the merchant, will make money on every foreign cardholder transaction. That means Canadian dollar cards in the U.S. or U.S. dollar cards in Canada, as well as cards from all over the world.

$$$ ON THE NET with DCC spins off all foreign transactions to Planet Payment, a transaction processor that specializes in foreign currency conversions and that maintains an “inventory” of foreign currency. In turn, Planet Payment, which charges the same amount for the transaction as the issuing bank does, kicks back a portion of the fee to you, the merchant.

These rebates are usually upwards of 50 basis points or about ˝%. So that means that in our $100 to Pounds Sterling example, the rebate to the merchant would be ˝% of $100 or $.50. While that might not seem like much at first, when you consider that roughly 5% of all cards presented for payment in the U.S. are foreign currency cards, that ˝% can quickly add up. Plus, if you are on any coast or border area of the country or if you are in or near a resort frequented by foreign travelers, the foreign card volume can jump to 20 or even 30%.

Dynamic Currency Conversion as a Way to Improve Customer Service
Foreign travelers are familiar with the currency conversion fee charged by banks. However, because this fee has always been buried within the exchange rate, they can never accurately know what the exact amount will be when signing the sales slip and they can never know what amount to expect (in their native currency) on their cardholder statement.

Now, $$$ ON THE BANK with DCC will enable you to offer enhanced guest service by providing, on the sales slip, text defining the amount charged in the merchant's currency (U.S. or Canadian dollars) and the amount charged in the cardholder's native currency. In the future, if the language of the cardholder is different from the language of the merchant, the information will be provided in both languages. This small difference makes a big difference in guest service.

Better guest service and money in your bank account, not in your bank's account, are the hallmarks of Dynamic Currency Conversion.


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Old Jun 8th, 2005, 11:05 AM
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Here is the link to the previously mentioned Visa web page:
http://www.corporate.visa.com/st/consumer_tip.jsp
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Old Jun 8th, 2005, 12:43 PM
  #33  
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If a business wants to charge you in USD, happily oblige.

By paying in CASH.

Introduction to your pals Alex Hamilton and Andy Jackson (if you are really cruel, include dimes and quarters/really really really cruel would be Sacajawea coins and $2 bills) will likely result in a magical conversion back to Euros.



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Old Jun 8th, 2005, 12:54 PM
  #34  
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I like that, QC.

I'll carry a few $100 bills - the most commonly counterfeited.

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Old Jun 8th, 2005, 12:56 PM
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Oh I really like that QC... I've got loads of pennies that I've been saving up to cash in at some point ;-) Can you imagine the look on their face if I started handing them rolls of pennies and nickles...
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Old Jun 8th, 2005, 01:23 PM
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QC,
I think many of us are tickled by the idea off paying in cash when a merchant attempts to bamboozle with dynamic conversion.
It's one thing for them to make the offer of which currency to pay and an entirely different thing for them to just go ahead and charge in dollars without advance notice.
Heck, I'd be willing to haul around a back pack full of pennies just for the joy of "paying in dollars"
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Old Jun 8th, 2005, 02:24 PM
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xyz123

In the VISA website, where can I find the link to the policy?

I went into www.visa.com but could not find the policy you referenced " ...As a consumer you may value knowing the exact price in your home currency at the point of sale but ..."
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Old Jun 8th, 2005, 02:42 PM
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I guess paying cash is a solution if you don't mind giving up the convenience of using a credit card. I don't relish being ripped off, but the "cost" of running to an ATM to get cash frequently (or more frequently) would be a factor for me, plus the nominal "protection" that the credit card company provides in certain cases. In a country like Italy where something in excess of 50% of the economy is in the tourism sector, I would think the government would get involved and set some rules. They seem to for everything else (i.e. when the heat can go on at the beginning of colder weather, etc)
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Old Jun 8th, 2005, 02:47 PM
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All this talk of a restaurant telling you they are going to charge you -- let's say -- $100 in US funds for your European meal, and then you offering to pay that amount in cash sounds pretty cool. Except, is anyone sure they will accept that amount? I wouldn't be surprised if they would want even more if you were paying in cash in US funds.
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Old Jun 8th, 2005, 02:50 PM
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http://www.corporate.visa.com/pd/consumer_ex_faq.jsp
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