Vendors offering "select your own payment currency"

[albatross710]

One of the foreign exchange features that I always decline is when overseas terminals and vendors offer to bill me in my home currency instead of the their currency.

For instance, this screenshot from a Cebu Pacific booking gives me the convenience of the amount being processed as a AUD figure instead of being set by the card company.

In this case 5J will bill me $309.20 instead of SGD312.58 which converts to $294.06. A saving of $15 on my part.



The transaction which appears on my card statement is




In my travels I have checked these sort of offers enough times to know that I am always better to be billed in the foreign currency and let the VISA exchange rate prevail.

Anyone else have similar experiences?

Alby

 

[Hvr]

Dynamic Currency Conversion aka DCC is a well known scam that some businesses engage in.

You did the right thing refusing the offer.

 

[lathiat]

It also worked a little better when sometimes it resulted in you not paying the 3% fee on your credit card, but most credit cards updated their terms in the last couple of years so that basically the card issuer, merchant, bank, currency and everything has to be local or it applies.

Their rate was probably more than 3% higher anyway.. sometimes I've converted these and it was close-ish and other times it was horrendous.

 

[Cruiser Elite]

Rule of thumb is always pay in local currency.

 

[penegal]

It also worked a little better when sometimes it resulted in you not paying the 3% fee on your credit card, but most credit cards updated their terms in the last couple of years so that basically the card issuer, merchant, bank, currency and everything has to be local or it applies.

Their rate was probably more than 3% higher anyway.. sometimes I've converted these and it was close-ish and other times it was horrendous.

The spread charged by DCC is usually much greater than 3% anyway.

Therefore local currency with a spread closer to the real rate + 3% is often better for you.

And as you mention many cards will charge you a fee on "foreign" AUD transactions.

 

[timbervolt]

I use Bankwest's Platinum Mastercard as it doesn't charge a foreign exchange fee so with it, it is better to pay in local currency.
Now, CBA's Diamond Awards Mastercard doesn't charge the Fx fee either, and attracts reward points.

 

[dajop]

Rule of thumb is always pay in local currency.

Cruiser, how do you go in China? There's a lot of discussion on Flyertalk (in CX and sometimes SQ credit card forums) of the difficulty in avoiding DCC at many hotels in China, both international and non-international ones alike. Personally, I only had difficulty once, other times I've been given the choice.