Choose to paywithdraw cash in Eur or GBP in Spain?

Millennium

Thanks for the tip on the PO CC. I am currently 'tarting' with this one, so when I pay it off next month I will not cancel it and use it abroad. I have more news on the PO travel money card which I will post separately.

Jake'sGran

For PeterBaker, That had not occurred to me so I will do it straight away. I have been enjoying arranging my own holidays and this aspect i.e. getting the better ROE had been one of the perks. I am still waiting to hear from Melia Sol about this and why points were not added to my account.

Incidentally, their hotel rates are very good so I should not complain too much really. The total was £590 for two people half board for ten nights in a four star.

GlennTheBaker

This thread has inadvertantly answered a 'question' I had in my little brain since a trip to Tenerife in September. I had no problems with DCC throughout my holiday until we made a purchase from a shop at the airport before our return journey. The payment was made by Chip & PIN but I was then handed a slip to sign with the usual 'I have been offered a choice of currency' !!!!!!. I asked to pay in Euro and a supervisor was called. He explained that by paying in Euro I would incur exchange rate commission fees. A sizeable queue was building at this point and, as the difference would amount to around 60p, I just signed the slip. I now see where the supervisor was coming from - if I chose to pay in Euro, the retailer would just convert it to Sterling anyway at an equally !!!!!! rate.

peterbaker

GlennTheBaker wrote:

I asked to pay in Euro and a supervisor was called. He explained that by paying in Euro I would incur exchange rate commission fees. A sizeable queue was building at this point and, as the difference would amount to around 60p, I just signed the slip. I now see where the supervisor was coming from - if I chose to pay in Euro, the retailer would just convert it to Sterling anyway at an equally !!!!!! rate.

Not quite...if you chose to pay in Euro, the retailer ('merchant') would not convert it at all. The VISA or Maestro or Mastercard network then does the conversion at an ok rate but they usually charge a 2.75% FOREX fee via your card provider. Net additional cost to you by the time you pay your CC bill, as opposed to paying in cash - 2.75%. Net additional cost to me with my Nationwide VISA card ... 0% (because Nationwide doesn't pass on the 2.75%!).

Compare to allowing the retailer to use DCC to convert - retailer adds "MarkUp 3%" (typically) and charges your card in Sterling. Net additional cost to you (or me with my Nationwide card) compared to cash ... +3% plus any detrimental effect of the exchange rate used in DCC (it's not a VISA rate, it's a rate applied by the merchant's bank to suit them and the merchant).

So, if you allow DCC to occur and you don't have a Nationwide or PostOffice or Saga card or one of the few like mine that do not pass on VISA's 2.75%, then it is only going to cost you around 0.25% more than it used to. Not worth the fuss I agree, but even on principle you might consider whether, if the local merchants and banks find it so easy to bypass VISA's 2.75% and snaffle it and a bit more for themselves, then why the hell should you have to pay anyone anything for the privilege of spending your own money??

GlennTheBaker

I think the supervisor was trying to blind me with science. I have a Nationwide Credit Card and I'm aware of the whole DCC thing - I thought that maybe there was a sort of 'new variant DCC' where if you chose to pay in Euro they still converted it into Sterling at an even worse rate but I realise that had I stood my ground and the transaction had been processed in Euro, it would have gone through my Nationwide account just as all the other Euro transactions during my trip. Like I said it only amounted to around 60p but next time I'll not back down!

peterbaker

Just thought I'd post a little extra history on this subject since I have had another conversation with Nationwide today about Ryanair using DCC for the past umpteen months without telling the customers (and they continue to do so!).

It seems DCC has actually been a possibility since 1997. It's that long ago that certain foreign retail merchants' banks in league with their retailer clients first dreamt it up as a way of grabbing some FOREX market share, perhaps in spite at the immovable VISA and Mastercard network charges. I'm told that VISA and Mastercard had little to do with DCC and even frowned on it initially but backed off perhaps due to the threat of accusations of monopoly practices. So they let the local processing banks and merchant banks do their thing and at some stage simply put it in their rules that the retail merchant (the seller) had to offer the customer a choice at point of sale (for obvious reasons).

Gradually it has become a problem. I think it reached a height problem-wise in 2005, and VISA and Mastercard firmed up 'Chargeback' procedures with the credit card companies because disputes involving surreptitious DCC were mounting rapidly.

Initially today, I actually got a guy in Nationwide's Dispute Resolution department who tried to tell me that they only got told about DCC in an internal memo dated Febuary 2006! He even disappeared off the phone to check with colleagues who unfortunately agreed with him. Having shot off the line before I could say "please don't" to prove his point, after his colleagues agreed he came back even more nonchalant than before!

February 2006 was probably just the latest memo, and staff turnover everywhere is so high that it was probably the first memo he'd ever seen about it!

When I offered him the chance to listen to me and check my account history where he could see I had a DCC as far back as July 2005 at least, and offered a chance to think again in preference to me suggesting some retraining via his manager, he declined and expressed the wish to finish the call without hearing any more about why I was calling. His manager and I had a friendly chat a short while later and I imagine he has been retrained now:-)

It's sometimes amazing how people in jobs where they need to understand their industry in detail are so resistant to simple criticism even in the face of overwhelming evidence. I was being exceptionally friendly because Nationwide customer services staff in particular always deserve it, but the moment I said I was sorry but he was wrong, he just couldn't handle it.

Thank goodness he is the exception at Nationwide. Their people are I have found, some of the best you will find in terms of good customer service.

Meanwhile DCC goes on, and I suggest you all check your statements carefully, especially if you use Nationwide or Post Office cards (to avoid the VISA/Mastercard 2.75% FOREX commission) and especially if you buy Ryanair in currencies other than GBP.

I have had about £35 refunded by Nationwide now for my Ryanair ticket purchases alone.

Jamp

Just noticed Ryanair have applied DCC to my latest flight without authorisation too. Are Nationwide footing the bill for them by refunding? Hopefully they'll put pressure on Ryanair and/or Visa to stop this if enough people complain. I agree it's fraud.

peterbaker

Jamp wrote:

Just noticed Ryanair have applied DCC to my latest flight without authorisation too. Are Nationwide footing the bill for them by refunding? Hopefully they'll put pressure on Ryanair and/or Visa to stop this if enough people complain. I agree it's fraud.

Nationwide will refund very quickly if you simply complete and sign a dispute form for them. If the transaction is less than 120 days old when they get the form back from you then under their own agreement with VISA, they can request (and get) a "chargeback" against Ryanair which as you say, exerts some commercial pressure.

Donnie

Don't forget the Audi Card; http://www.audi.co.uk/audi/uk/en2/financial_services/audi_card.html