Dynamic Currency Conversion – a real world example


I’m writing this from Kuala Lumpur, Malaysia, where I’m currently on holiday with my family over the Lunar New Year period. Whilst here, I needed to get some local currency out – the Malaysian Ringgit – to pay for some bills (I’d use the credit card, but they don’t seem to have as wide an acceptance here!)

At the cashpoint, I was offered the choice in Pounds Sterling rather than Malaysian Ringgit – around £213.00 for RM1,000.00. Because I was using my Metro Bank Debit Card, I knew that being charged in the local currency would be the best option: fortunately it was possible to opt out. On getting back, I found out that my card had been charged £205.79: £7 less than if I’d opted to pay in pounds.

This isn’t restricted to cash machines, however: it can also be found at credit card terminals in shops – so, if you’re ever asked whether you’d like to pay in pounds abroad, you should always decline if you’re using one of the recommended cards.

3 thoughts on “Dynamic Currency Conversion – a real world example

  1. Hi Nick

    Thanks for bringing this really thorny issue to the table. I recently changed my web host to a US company who I pay with my Nationwide Select card. Obviously, no exchange fees/markup so I would naturally want to be charged in USD.

    The first payment was in USD but the second was taken in GBP after being DCCd. The Visa rules are clear that this should be (a) optional and (b) an opt-in service, not an opt-out service (I was automatically opted-in) so I asked them to reverse the transaction and charged in USD.

    Lo and behold, they refunded in USD and recharged in USD causing a currency spread issue.

    If you have a look at the Flyer Talk forums, there are some horror stories from travellers in China who have had nothing but problems trying to decline DCC at even some of the larger establishments.

    I personally think it ought to be banned, but that’s just my personal opinion.


    • Nicholas Heung

      Definitely think it should be banned – There’s even some places in the UK that attempt to force the DCC – a cash machine at London Stansted airport wouldn’t let me take out Euros without charging it to me in pounds: no big loss there though, I just did the exchange once abroad.

      I’ve even seen some people complain about being charged a foreign transaction fee for a DCC transaction, even when they are billed in the currency of their card.

    • Hi Nick, as an American expat in London, I come across this problem a lot. Contrary to Verne’s point on what should be the case, often I find myself being “auto opted-in” to the USD rate, aka the more expense rate, rather than opting-out of the local currency (obviously GBP in London).
      It is well confusing, and I am fully behind your efforts as a leader in this arena to bear the flag for its outlaw.

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