If this is your first visit, be sure to check out the FAQ by clicking the link above. You may have to register before you can post: click the register link above to proceed. To start viewing messages, select the forum that you want to visit from the selection below. |
|
|
Thread Tools | Display Modes |
|
#1
|
|||
|
|||
Beware - credit card rip-off
There is a new "facility" you may encounter when paying by credit card in a
foreign currency. The POS terminal identifies which country your credit card is from and conveniently converts the local currency into your home currency. Your credit card is then billed in your home currency rather than the local currency. Might sound helpful, but the catch is that the exchange rate at which the conversion is done is almost certainly a lot worse than your bank would use if you got billed in the local currency. The retailer usually gets a cut of the exchange rate markup so it's in their interest to bill you in your home currency. They are supposed to ask you which currency you want to billed in, but it practice it doesn't always happen, and the default is to bill you in your home currency. But you are perfectly entitled to insist you are billed in the local currency, after all the product or service will have been priced in the local currency. Don't let retailers rip you off in this way! -- Andy |
#2
|
|||
|
|||
Beware - credit card rip-off
"Andy Pandy" wrote in message ... There is a new "facility" you may encounter when paying by credit card in a foreign currency. The POS terminal identifies which country your credit card is from and conveniently converts the local currency into your home currency. Your credit card is then billed in your home currency rather than the local currency. Might sound helpful, but the catch is that the exchange rate at which the conversion is done is almost certainly a lot worse than your bank would use if you got billed in the local currency. The retailer usually gets a cut of the exchange rate markup so it's in their interest to bill you in your home currency. They are supposed to ask you which currency you want to billed in, but it practice it doesn't always happen, and the default is to bill you in your home currency. But you are perfectly entitled to insist you are billed in the local currency, after all the product or service will have been priced in the local currency. Don't let retailers rip you off in this way! It's called 'Dynamic Currency Conversion' in the trade-speak. It's touted among retailers and service providers (hotels, car rental firms etc) doing a lot of business with foreign visitors, and also on-line dealers. The card processors entice them with 'customer satisfaction' and 'extra income stream' (i.e. sharing exchange mark-up). First developed by the Irish firm Forexco, it's now offered globally and adopted by leading retailers like Harrods and international hotel groups. I now make the point of insisting before my card is swiped that I want to be charged in the local currency. Visa/Plus and Mastercard/Cirrus regulations stipulate that customer must be given a choice. If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. If they still refuse, tell them you'll ask your card issuer for a chargeback. Expect a dirty look or take your customs elsewhere. Alec |
#3
|
|||
|
|||
Beware - credit card rip-off
On Tue, 20 Apr 2004 09:57:11 +0100 Alec
said... If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. Could prove difficult when paying for goods after you've used or consumed them - e.g. restaurant or hotel bills. Petrol stations would have difficulty in asking for your fuel if you didn't want to pay for it! For shops you could just refuse to buy the goods and walk out which is where I think the smart consumer will win over this practice. If they still refuse, tell them you'll ask your card issuer for a chargeback. Which is what I've had to do and only for the difference which may not be a huge amount, but it's the principle that counts. The card receipts are the only proof of the price in local currency if my experience is anything to go by. You'll need to keep them and supply copies as evidence for any dispute. Difficult or impossible for phone or internet transactions as a credit card receipt isn't always issued. The local currency or rate of exchange for these DCC type transactions don't appear on your statement either, just the rate in the currency of the card issuer. -- Phil Richards London |
#4
|
|||
|
|||
Beware - credit card rip-off
Phil Richards wrote:
On Tue, 20 Apr 2004 09:57:11 +0100 Alec said... If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. Could prove difficult when paying for goods after you've used or consumed them - e.g. restaurant or hotel bills. Petrol stations would have difficulty in asking for your fuel if you didn't want to pay for it! In such cases, I would see it differently: you have the whip hand. You will almost certainly bought on the basis of a menu or price display showing prices in the local currency from a trader who had also displayed a sign showing willingness to accept your type of CC. The reasonable inference is that the trader must accept settlement in the local currency charged to your CC account. Anything else done without your express agreement is taking an indefensible liberty. Offer to walk, and see what happens. -- PB The return address has been MUNGED |
#5
|
|||
|
|||
Beware - credit card rip-off
On Tue, 20 Apr 2004 20:55:49 +0100 Padraig Breathnach
said... In such cases, I would see it differently: you have the whip hand. You will almost certainly bought on the basis of a menu or price display showing prices in the local currency from a trader who had also displayed a sign showing willingness to accept your type of CC. The reasonable inference is that the trader must accept settlement in the local currency charged to your CC account. Anything else done without your express agreement is taking an indefensible liberty. I wholeheartedly agree with you there. I'll be one step ahead next time and before I hand my card over I'll be asking ask the retailer first. In Ireland or the US for example no problem, however it could prove different when there are language differences and I'm afraid to say that is where the consumer is most likely to loose out. The phrase "they are supposed to ask first" before taking the option to bill in local or currency or whatever I take with some suspicion. This of course may or may not be laid down in some terms & conditions between agreed the retailer and their card handler. Depending on the adverse publicity and negative reaction from consumers coupled with an increase number of complaints and charge back disputes I somehow can't see this practice lasting for very long. We'll see. -- Phil Richards London |
#6
|
|||
|
|||
Beware - credit card rip-off
Phil Richards wrote:
Alec said... If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. Could prove difficult when paying for goods after you've used or consumed them - e.g. restaurant or hotel bills. Seems to me you consumed goods based on the price they represented, then suddenly at payment time they decided they wanted to change the price. I'd guess you'd be within your rights to stand firm on the price they initially told you you'd have to pay, sans unwanted double-conversion markup. miguel -- Hit The Road! Photos and tales from around the world: http://travel.u.nu |
#7
|
|||
|
|||
Beware - credit card rip-off
On Tue, 20 Apr 2004 23:06:31 GMT, Miguel Cruz wrote:
Phil Richards wrote: Alec said... If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. Could prove difficult when paying for goods after you've used or consumed them - e.g. restaurant or hotel bills. Seems to me you consumed goods based on the price they represented, then suddenly at payment time they decided they wanted to change the price. I'd guess you'd be within your rights to stand firm on the price they initially told you you'd have to pay, sans unwanted double-conversion markup. Exactly. Its not much different than if you were paying by cash. If the bill came and they asked you to pay in some currency other than the local one the menu prices were quoted in, you would be entitled to refuse. |
#8
|
|||
|
|||
Beware - credit card rip-off
Alec wrote:
"Andy Pandy" wrote in message ... There is a new "facility" you may encounter when paying by credit card in a foreign currency. The POS terminal identifies which country your credit card is from and conveniently converts the local currency into your home currency. Your credit card is then billed in your home currency rather than the local currency. Might sound helpful, but the catch is that the exchange rate at which the conversion is done is almost certainly a lot worse than your bank would use if you got billed in the local currency. The retailer usually gets a cut of the exchange rate markup so it's in their interest to bill you in your home currency. They are supposed to ask you which currency you want to billed in, but it practice it doesn't always happen, and the default is to bill you in your home currency. But you are perfectly entitled to insist you are billed in the local currency, after all the product or service will have been priced in the local currency. Don't let retailers rip you off in this way! It's called 'Dynamic Currency Conversion' in the trade-speak. It's touted among retailers and service providers (hotels, car rental firms etc) doing a lot of business with foreign visitors, and also on-line dealers. The card processors entice them with 'customer satisfaction' and 'extra income stream' (i.e. sharing exchange mark-up). First developed by the Irish firm Forexco, it's now offered globally and adopted by leading retailers like Harrods and international hotel groups. I now make the point of insisting before my card is swiped that I want to be charged in the local currency. Visa/Plus and Mastercard/Cirrus regulations stipulate that customer must be given a choice. If they still put through the transaction in the card's billing currency, refuse to sign the slip and ask them to void it. If they still refuse, tell them you'll ask your card issuer for a chargeback. Expect a dirty look or take your customs elsewhere. Alec That all sounds VERY strange. At least in the past the credit card companies ONLY allowed local currency billing. One guy I know went to South America and a guy in his hotel (who did not know the rules) were so horny for USD that he persuaded the guest to pay the hotel bill in USD via credit card. When coming back home to Europe he was very surprised to get a withdrawal of only a few EUR - why? The credit card company do not allow other than local billing, thus he paid in local currency and not USD. Cheap! the rate was about 100:1 or so. Wonder if this temporary hotel guy had to pay? /Anders -- Remove the obvious part before replying by mail please! |
#9
|
|||
|
|||
Beware - credit card rip-off
That all sounds VERY strange. At least in the past the credit card companies ONLY allowed local currency billing. One guy I know went to South America and a guy in his hotel (who did not know the rules) were so horny for USD that he persuaded the guest to pay the hotel bill in USD via credit card. When coming back home to Europe he was very surprised to get a withdrawal of only a few EUR - why? The credit card company do not allow other than local billing, thus he paid in local currency and not USD. Cheap! the rate was about 100:1 or so. Wonder if this temporary hotel guy had to pay? Well in the past no one else did foreign exchange conversion other than Visa/Mastercard and your card issuer. But as the former started making a lot of profit out of it, by tacking on 2-3% conversion fee (1% by Visa/Master and the rest by card issuer, usually hidden in the rates used so not always obvious to cardholder), someone said. 'Hey, can't we get a slice of this lucrative market by doing the conversion upfront and keeping the transaction entirely in the card's billing currency?' Once they comply with Visa/Master rules by giving customers a 'choice' of billing currency, then the operation is entirely legitimate. For some cardholders, it must be said that they are no worse off as DCC rates are pretty in line with what they would get by traditional method as they are charged by card issuers (and might welcome the 'transparency' of knowing exactly how much it costs), but for others who hold a card with no foreign exchange fees (like Nationwide in UK and some credit unions in US), the loss can be as much as 3-3.5%. Alec |
#10
|
|||
|
|||
Beware - credit card rip-off
On Wed, 21 Apr 2004 10:24:24 +0100 Alec
said... Once they comply with Visa/Master rules by giving customers a 'choice' of billing currency, then the operation is entirely legitimate. Thanks for clarifying this. Presumably then it's not down to the T&C or agreement the retailer has with their merchant bank who own their POS terminal? Saying to a retailer it's against their agreement not to be asked first with Visa or MasterCard might have a bit more ammunition. -- Phil Richards London |
Thread Tools | |
Display Modes | |
|
|
Similar Threads | ||||
Thread | Thread Starter | Forum | Replies | Last Post |
Anyone redeemed their credit card points/air miles to purchase air tickets? | mark sabatini | Air travel | 10 | June 8th, 2004 06:53 PM |
Paying cash for tix | Scott | Air travel | 31 | April 2nd, 2004 11:02 PM |
credit card awards points | Brett | Air travel | 5 | January 9th, 2004 04:08 PM |
Thailand Elite Card value (?) | Vagabond | Asia | 3 | November 19th, 2003 06:17 PM |
Royal Bank - RBC - Avion / Voyages credit card | Jonathan Berry | Air travel | 0 | September 26th, 2003 01:45 AM |