Dynamic Currency Conversion (DCC) is a service offered by some merchants and banks to allow customers to settle transactions in their home currency while paying with their debit or credit card or withdrawing cash from ATMs abroad. Although DCC might seem handy at first glance, there are some important reasons why you should definitely not use it. This article explains what DCC is, why it's expensive, and who benefits from it. We also give advice on how you can protect yourself and what options you have for complaints.

Dynamic Currency Conversion (DCC) is a service that you should definitely avoid due to the high cost and loss of benefits. It's important to have your card-issuing bank handle foreign currency conversions to take advantage of cheaper exchange rates and lower commissions. Find out in advance about the potential cost of DCC and refuse to use it if the dealer insists. In the event of unlawful use of DCC, you should contact your bank for clarification and possible reimbursement.

Please note that the information described is general in nature and is not intended as legal or financial advice. If you have specific questions or problems, you should contact your card-issuing bank directly.

What is Dynamic Currency Conversion (DCC)?

DCC enables merchants and banks to offer customers to convert the amount into their home currency during a transaction abroad. Instead of the card-issuing bank doing the conversion, it's done on the spot by the merchant or ATM company. The customer sees the amount in their home currency and is prompted to complete the transaction on that basis.

Why should you avoid DCC?

• High costs: DCC is usually very expensive. The exchange rates offered are often unfavorable and associated with high commissions. This can lead to significant additional costs, especially for large transactions.
  
• Loss of Benefits: If you choose DCC, you may miss out on additional benefits that your card-issuing bank could offer, such as lower exchange rates or cheaper transaction fees.
  
• Lack of transparency: Often the actual costs of DCC are not clearly displayed. The exchange rate and commissions can be hidden or misleading, making it difficult to understand the exact cost of the transaction.

Who benefits from DCC?

• Dealer: Merchants that offer DCC typically receive a commission for each transaction that uses DCC. This can be an incentive for them to push customers to use DCC.
  
• ATM operators: When withdrawing cash from ATMs abroad, ATM operators can use DCC to benefit from the commissions that are incurred when converting the currency.

How can you protect yourself?

• Rejection of DCC: Insist that the transaction is in the local currency and let your card-issuing bank do the conversion.
  
• Enlightenment: Find out in advance about the possible costs of DCC and compare them with the conditions of your card-issuing bank.
  
• Communication with the bank: In the case of unauthorized use of DCC, you can contact your card-issuing bank to clarify the situation and request a possible reimbursement of the additional costs.