When returning from a trip to the United Kingdom, I was going through the stack of receipts I threw in my luggage while reconciling my credit card statements. Everything was looking fine until I came up to one that looked a little off. It only took me a few seconds until I figured out what happened. Sharon and I were taken by one of the most common scams foreigners fall for when traveling overseas.
Dynamic Currency Conversion.
This is a practice where the vendor, in this case, a restaurant, takes your charge in a foreign currency and converts it into your home currency, while charging you a convenience fee for the service.
Here’s our receipt for dinner. I removed the name of the restaurant.
From the receipt, our bill was £65.14 and our credit card was charged $90.13 USD. I love the disclaimer on the receipt.
I have been offered a choice of currencies and have chosen to accept DCC and pay in US DOLLAR at today’s exchange rate. Mark up: 3.99%
In the words of Sharon, “NO WE WEREN’T!”
Tell me about it. For this bill, we were charged an exchange rate of $1.383586/£1
I’ve written about the Dynamic Currency Conversion scam and how, if you are asked if you want to pay in local currency or your currency, you should always pick the local currency. Not only will you always get a better conversion rate from your bank, but you’ll also still have to pay a foreign transaction fee if your card charges one. I hope you’re using a card that waives those fees.
Thankfully Sharon paid with her American Express Bonvoy Brilliant card so we didn’t have to pay any additional fee to the extra 4% Mark Up.
So what should have we paid?
Let’s compare this bill to our check for dinner the previous night at Duck & Waffle Local.
Our bill was £74.25 and we paid in local currency. The charge on our AMEX bill showed up as $98.86. That means we paid an exchange rate was $1.33/£1.
Big picture, how much did this cost us? If we had paid the bill in local currency at the lower exchange rate, we would have paid $86.63 for dinner. Instead, we paid $90.13, a difference of $3.50. I’ll round a tip by more than that if we get good service.
Was it worth this restaurant to screw me over for $3.50 in currency conversion charges? I don’t think so. They managed to turn a pleasant dinner with really good food into an experience where I feel I was taken advantage of for less than $4.
I mean, the food was really good. If they didn’t pull a stunt like this, I might have even told you how good the food was and that you should go there when you visit London. But now, nope. To be fair, I’ll try to reach out to the establishment and let them know what happened and will update the article if I hear back from them.
Until then, check out the lamb shoulder that Sharon had for dinner. It was really good. It’s a shame I can’t recommend the place.
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This post first appeared on Your Mileage May Vary