Thanks Erin. I guess this makes me hesistant to include my Citibank credit card in my planned experiment -- but actually these days I don't use it anyway. I use my ATM card which doubles up as a debit/charge card, which is also from Citibank. It sounds like the fees should be lower there.

Look I don't mean to be a worry wart but here goes....

Using a debit card's credit card type feature can be very dangerous. There is a great deal of credit card number stealing going on in London...it is almost an epidemic there now. The merchant may have a small scanner out of sight or simply memorizes the number when you pay for a purchase. He then transmits the number (along with the farce of a security code on the back signature panel) to an organized crime ring...the biggest offenders of this currently seem to be the former states which made up the Soviet Union (Ukraine is very much into this) or Nigerians. They then clone the card or make purchases via the internet. The result, they ring up charges up the gazoos. This is what happened to me a couple of years ago. Before I knew it there were $8,000 of charges on my credit card account through a crooked internet merchant in France. Not a problem, no money actually left my account. Two or three phone calls and an affadavit resolved the problem quickly. No great harm done.

But with a debit card......they drain actual real money from your account. Cheques you have written turn to rubber. Yes you usually get the money back but until then you are out of luck. How do you pay your rent? Your utilities etc with this money drained from your account. And then you have to get a new chequing account number etc. etc. etc.

I wouldn't use a debit card for purchases because of this unfortunately. Besides with a credit card I get a float of anywhere from 21 days to close to 2 months depending on the closing date of the credit card statement. I only use the credit cards that do not append this extra 2% fee which in theory should be the same as ATM's as ATM withdrawals with debit cards clear through the Visa or MC system.

Go back and you will find threads describing this and explaining the pitfalls of using debit cards as credit cards which is what banks want you to do but be aware of the dangers.

That's precisely the reason why I no longer carry a debit/credit card. Most banks automatically issue these now, but they're just too dangerous IMO since funds can be accessed from your bank account without the use of a pin. I had to contact my bank to have an ATM only card issued.

The credit card agreement provided by my bank advises that Mastercard/Visa has a currency conversion procedure that is disclosed to institutions that issue Mastercard/Visa cards. My bank advises that the current procedure is to use either a government-mandated exchange rate, or the wholesale rate in effect the day before the transaction processing date, increased by 1%. They further point out that the date used may differ from the purchase date or the statement posting date.

I suspect that we have all been provided this information by our banks, but haven't bothered to read it.

111op, you're tough to convince. clevelandbrown (My condolences on the death of Otto Graham) has already spelled out the procedure but here it is again from my cc agreement:

"Visa or MasterCard will use their currency conversion procedures in effect when they process the transaction. Currently, to convert to US dollars, they use either a wholesale market rate or a government mandated rate and add one percent to that rate."

The class action suit that Visa and Mastercard settled was based upon the non-disclosure of the 1% charge and not on the conversion procedures which were not questioned.

Ok, just skeptical. It comes with the training, you know. Now I know. Thanks for doing the work for me. (But notice the little caveat in cleveland's note regarding the possible differences in dates.... Sometimes I think that these companies just go back and pick the worst possible rate. It's a bit like banks holding interest on checks waiting to clear.)

I don't recall seeing conversion charges, but then, they could be buried in there somewhere.

Will have to look at future statements more carefully. But of course, I'm forever penny-wise and pound-foolish -- the charges, after all, are going to be much smaller compared to the cost of the trip.

I think the bank's caveat concerning processing dates has more to do with when the merchant submits the charge than with the processing company holding the transactions until they find a date with a favorable rate change. We stayed at a remote village in Switzerland and when I had not received a charge (my bank provides daily updates of charges online) for three weeks I emailed the inn, and they responded that they had only taken the slips to the bank recently. A few days later the charge showed up.