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Why DCC can spell out trouble shopping abroad.

Byline: By Jeremy Gates Special Correspondent

At the busy supermarket checkpoint in the Auchan superstore in Calais the other day, pushing a trolley full of beer and baguettes, I was under-prepared for the cheery greeting from the checkout girl.

"Do you want to pay in euros or sterling?" she asked brightly, as I proffered an M&S Money Card. I replied that I would pay in sterling when the credit card statement eventually arrived.

As a frequent visitor to Auchan superstores, I had never faced that question before. Curiously enough, no one mentioned it when I drove across the forecourt and spent another three-figure sum in Sainsbury's wine store in another corner of the same site as Auchan.

So only my Auchan receipt carried this statement on my till receipt: "I have chosen not to use the MasterCard currency conversion process and agree that I will have no recourse against MasterCard concerning the currency conversion or its disclosure."

Had I really made any such choice, with a crowd of French teenagers jostling behind me and urging "Granddad" to get on with it?

Or had I unwittingly been caught by dynamic currency conversion (DCC) fees, now hitting many British travellers using credit and debit cards in Southern Ireland, Spain, France and the US, according to Nationwide BS.

Further afield, the practice is becoming common in Cyprus, Australia and Hong Kong. Nationwide reckons spending by DCC jumped by 49 per cent over the past year, leaving cus-tomers around pounds 850,000 out of pocket - money they would have saved by agreeing to pay in local currency.

Visa and Mastercard insist retailers must give consumers the option-before they decide how to pay. But how many of the two million Brits starting annual holidays abroad over August Bank Holiday - making this week, says M&S Travel Money, the busiest of the year for the purchase of foreign currency, travel insurance and last-minute accessories like sunscreen - will get the right answer if they get the same question as me?

Most of us know that foreign currency varies widely in price. M&S Travel Money says the cost of 500 euros can vary by as much as pounds 35, with M&S claiming its Fair Prime Promise of no commission on foreign currency or foreign travellers cheques makes it one of the cheapest providers.

However, the M&S Money card is outshone by rivals in a survey on, a leading flight price comparison site, because of its 17.9 per cent APR on outstanding balances, plus a 2.75 per cent currency conversion fee on foreign purchases. Cheapflights tips the HSBC Premier credit card as a best buy for frequent duty-free shoppers.

All this is familiar stuff to cardholders abroad. DCC, I suspect, is more of a mystery, and with Britons making 288 million transactions on payment cards outside the UK in 2006, its potential to run up hidden charges is enormous.

"If you don't express a clear request to pay in local currency", says Nationwide's Rachel Shephard: "Retailers can charge whatever they like for currency conversion. As far as I am aware, there is no limit on the charge.

"So far as card providers are concerned, it goes on your statement as a sterling transaction. It is rare for retailers to charge less for conversion than a card provider, and almost invariably they charge more".

DCC creates the biggest losses for travellers using cards like Nationwide's, which make no conversion charges on overseas transactions.

In nearly every instance, however, cardholders who express a wish to pay in local currency travellers cheques will find they have saved money when their statement eventually comes in.

If they weren't offered the choice by the retailer, however, M&S Money's Liz Nield points out that they can request a chargeback on a disputed transaction.

INFORMATION: M&S Travel Money (0870 600 3502); Nationwide enquiries through branches; card survey of overseas purchasing costs on

Retailers can charge whatever they like for currency conversion. As far as I am aware, there is no limit on the charge

Rachel Shephard


A daytripper loads his car at the Auchen supermarket car park in Calais. Hundreds of Britons using credit and debit cards are being caught by dynamic currency conversion fees
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Publication:The Birmingham Post (England)
Date:Aug 25, 2007
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