Holiday scams Currency conversion

Always check which currency you're being asked to pay the bill in

When you're paying by card on holiday and you're presented with the bill – be it in a shop, hotel or restaurant – do you take notice of the currency in which you're being asked to pay? If not, then you should start doing so right now. 

Dynamic currency conversion

The practice of dynamic currency conversion (DCC) is an increasing trend around the world.

This is where foreign retailers bill you in sterling rather than the local currency and calculate their own rate of exchange. 

This is not illegal, but the exchange rate used is typically worse value than the fee charged by your card issuer. The practice is also now used at some foreign ATMs. 

Dynamic currency conversion is an increasing trend worldwide

Countries where DCC is most prevalent include Ireland, Spain, France and the US. 

The good news are that when conducting our research, we found that only 7% of respondents had experienced DCC while on holiday. 

But this figure is likely to be much higher as the practice often goes unnoticed; many holidaymakers accept being billed in sterling rather than the local currency as they don't realise it could be costing them more. 

Tips

To make sure you don't pay any more than you have to, follow our advice:

• Be vigilant. You should be given the choice of whether to pay in sterling or in the local currency. Signature slips or bills where DCC has been applied may contain a statement that reads something like; ‘I accept I have been offered a choice of currencies for payment and I accept the conversion rate and final amount.’ If you are not given a choice, you're within your right not to sign. Altering the slip, say by crossing out the amount in sterling, will not stop the transaction taking place.
• Always insist the bill is paid in the local currency. If you are given no option but to pay in sterling, then
  contact your card issuer who should investigate the matter further for you.