MSE News: Paying by card on holiday? Here's why you should keep hold of the terminal

firefox1956

adriansaggers wrote: »

I had an unpalatable experience at a branch of Cafe & Tapas in Madrid. I kept hold of the cash machine but still I was charged in sterling. I asked for the transaction to be voided but the trader refused. To add insult to injury the receipt from Comercia Global Payments had a declaration printed on it saying 'I accept that I have been offered a choice of currencies for payment etc'. The staff at the outlet said they were acting under instructions and I should make a complaint on their website if I was not happy. Guess where we I didn't eat anymore in Madrid!

Complain to your card issuer & they should refund you the difference.

NFH

Last year my girlfriend paid a restaurant bill of EUR 26.50 in La Linea in Spain from the EUR balance on her Revolut card. After she had authorised EUR 26.50 to be charged to her card by entering her PIN and handed the card terminal back to the waiter, a message appeared on the terminal asking whether she instead wished to pay GBP 23.61 (which was 3.3% more) - with "yes" and "no" options. As the waiter was holding the card terminal, she and I clearly told the waiter "no" twice and that she wished to pay in EUR. The waiter ignored our instruction and disingenuously pressed "yes", causing her card to be charged GBP 23.61 without her authorisation. Although the amount was small, the principle of Spanish merchants scamming non-Eurozone tourists by 3.3% is not one that we wished to support. Therefore we insisted that the merchant reverse the unauthorised transaction. First an assistant manager came to speak to us, who showed us the receipt stating that my girlfriend had agreed to be charged in GBP (whereas it was the waiter who had agreed to this, not my girlfriend). She said that they didn't know how to reverse the transaction, so I suggested that they give us GBP cash. After all, it was they, not us, who decided to transact in GBP, and my girlfriend isn't even from the UK. She said that they didn't have any GBP cash, so I told her she should go to Gibraltar (the border being only half a mile away) and get some. I told her very clearly and audibly that what the waiter had done was dishonest, at which point other diners started to take an interest. Eventually the manager came out, who refunded GBP 23.61 to my girlfriend's Revolut card (which took a couple of days to appear on her Revolut account unlike the original charge which was instant). She paid the EUR 26.50 again, processed correctly this time. It took almost half an hour, but we really wanted to make the restaurant think twice before scamming any future customers.

DCC-enabled card terminals use the card's IIN/BIN (issuer identification number, the first 6 digits of the card number) to detect the card's country of issue. Card terminals cannot detect the currency of the card or of its underlying account, only its country of issue, but an assumption is made that the card's currency is the currency in the card's country of issue (a false assumption in the case of a UK-issued card on a EUR account). Revolut supports holding balances in EUR, USD, GBP, JPY, CHF, SEK, DKK, NOK, PLN, HUF, RON, TRY, ILS, CAD, AUD, NZD, HKD, SGD, ZAR, MAD, QAR, AED, THB and INR, so the country of issue should be an irrelevance. I notice that Revolut's recently-issued cards have an IIN showing that the country of issue is Romania, as opposed to the UK for its earlier cards, which should curtail dynamic currency conversion for its customers, given that RON is not a currency to which DCC is commonly carried out. The DCC scammers mostly target currencies with global 24x5 liquidity.

Many years ago, I used a Visa debit card on a EUR-denominated Jersey bank account, on which I first experienced DCC in 2002, in both Ireland and Spain. But now I never experience DCC in the Eurozone, as I use a UK-issued EUR-denominated American Express card. American Express doesn't allow DCC. If a merchant doesn't accept Amex, then I use a Visa debit card on my German bank account.

I urge everyone who experiences DCC, no matter how small the amount, to kick up a big fuss and overtly accuse the merchant of dishonesty. Where the currency and amount are changed after authorisation, it is fraud. The amount might be small in individual cases, but the big picture is an enormous scam, facilitated only because many consumers can't be bothered to complain about small amounts.

NFH

The MSE article says "European law states the currency that customers are charged in must be agreed before the transaction, and if currency conversion is offered the customer must know all charges and the exchange rate beforehand too".

I've found what I believe is the legislation that MSE is referring to. Article 49 of Directive 2007/64/EC (the "Payment Services Directive") states:

1. Payments shall be made in the currency agreed between the parties.
2. Where a currency conversion service is offered prior to the initiation of the payment transaction and where that currency conversion service is offered at the point of sale or by the payee, the party offering the currency conversion service to the payer shall disclose to the payer all charges as well as the exchange rate to be used for converting the payment transaction.

The payer shall agree to the currency conversion service on that basis.

And in Spanish to quote to errant merchants (although MSE intentionally corrupts the spelling):

1. Los pagos se efectuar!n en la divisa que las partes hayan acordado.
2. Cuando se ofrezca un servicio de cambio de divisa con anterioridad al comienzo de la operaci!n de pago y dicho servicio de cambio de divisa sea ofrecido en el punto de venta o por el beneficiario, la parte que ofrezca el servicio de cambio de divisa al ordenante deber! informar a este de todos los gastos, as! como del tipo de cambio que se emplear! para la conversi!n de la operaci!n de pago.

El ordenante aceptar! el servicio de cambio de divisa bajo estas condiciones.

The directive doesn't say that the currency must be agreed before initiation of the transaction. It actually says what must be disclosed to the customer if a currency conversion service is offered before initiation of the transaction. The directive seems badly worded, because it doesn't cover what happens if a currency conversion service is offered after initiation of the transaction, which is what happens with dynamic currency conversion, i.e. after you insert your card, and in some cases after you enter your PIN.

EU legislation is desperately needed to prohibit the offering of a currency conversion service after initiation of the transaction, i.e. after presenting the card or card number for payment. Any change of currency must be agreed before the card is presented, i.e. before the merchant can identify the country of issue of the card. This would kill off dynamic currency conversion except for consumers who specifically ask for it.

osborne1-0

What should we do when hiring a car?
Everything is paid in Euros, including the fuel deposit.
At the same time request fuel deposit to be refunded in Euros, when possessed.
But every time it is refunded in Stirling, when we are back in the UK.

NFH

osborne1-0 wrote: »

At the same time request fuel deposit to be refunded in Euros, when possessed.
But every time it is refunded in Stirling, when we are back in the UK.

On a refund, DCC can work in the card holder's favour, because the rate is the same, but on buying GBP instead of selling GBP. That's if DCC follows the same principle on refunds as card issuers follow.

If the rate is instead marked up in the opposite direction, you should query this with the hire car company. Tell them that you did not receive the full EUR x.xx, and instead received GBP y.yy, which is contractually insufficient.

Bail64

Just returned from holiday to Gran Canaria and tried to get some money from atm only to find best part of £1900 ( account cleared out) gone .
Contacted Lloyds Bank after finding online that 2 transactions are pending - one for £41 and another for £1800+ leaving my account empty .
Before I went away I went online to inform them I may be using my debit card in Spain between the 2nd and 10th . On the 8th I went online to cancel this as hadn't needed to use and didn't mean to use the card last couple of days - obviously thinking this would then flag up any purchase/out of the ordinary purchase , especially abroad ???
Then on last day whilst doing some last minute gift shopping , I got separated from partner who had our cash so I used debit card for €45/£41 purchase . Shop keeper handed me card machine which said €45 , put in card and pin , removed card when prompted and I've receipt for the €45 . At around the same time a chip and pin transaction for £1800+ has been made without my authorisation . Foriegn transaction ! , out of the ordinary amount ! - no flags ???
Lloyds have said as it is a chip and pin transaction ( not done by me ) the card has not been compromised and they will do nothing about it .
Obviously I'm bloody furious , told them so and told them I will have to seek legal advice . They told me they will report it as a complaint and someone from the complaints department will contact me within 48 working hours . But from my initial contact with them I hold out little hope of them being willing to do anything .
Has anyone any advice as to my options before they get back in touch ?

NFH

Bail64 wrote: »

Shop keeper handed me card machine which said €45 , put in card and pin , removed card when prompted and I've receipt for the €45 . At around the same time a chip and pin transaction for £1800+ has been made without my authorisation . Foriegn transaction ! , out of the ordinary amount ! - no flags ???
Lloyds have said as it is a chip and pin transaction ( not done by me ) the card has not been compromised and they will do nothing about it .
Obviously I'm bloody furious , told them so and told them I will have to seek legal advice . They told me they will report it as a complaint and someone from the complaints department will contact me within 48 working hours . But from my initial contact with them I hold out little hope of them being willing to do anything .
Has anyone any advice as to my options before they get back in touch ?

Wait until you receive the Lloyds' final response and then escalate to the Financial Ombudsman Service. The onus will be on Lloyds to prove that the transaction was authorised by you. The onus is not on you to prove that it was not authorised by you.

In the meantime, you should pressure Lloyds to apply a temporary credit. I believe there is some requirement for them to do so while they investigate a disputed transaction, the rationale being that you should not be out of pocket for a duration that is caused by the card issuer's own delay.

Two questions:

1. What was the currency and amount that was charged to your card?
2. Does the authorised transaction for EUR 45 appear on your statement?