Many consumers make a conscious choice where they go to exchange cash before leaving for a trip abroad. They may well look at options available to them at a number of places on the high street; it might involve research online; alternatively they may choose to do this at the airport because it’s convenient and something they can take care of once they have safely checked in.

By contrast, what consumers don’t stop to check is the options available to them when using their card abroad.

Even though using a credit or debit card during a holiday has become part and parcel of most people’s trips, many still haven’t got to grips with the choices available as part of this process. One of the main areas of education required lies in the two currency options consumers are presented with when using a chip and pin in another country.

What they might not fully understand is the choice presented to them when they use their card to make a purchase abroad. They can either pay in their home currency with full visibility of the cost of the transaction, which includes the exchange rate and any conversion fees at the point of purchase, or to pay in the local currency of the merchant and accept their issuer’s rates and fees, which they may not know.

There are different reasons for selecting either option, but having the choice is designed to improve the travel experience for consumers abroad. Where previously consumers would have only been able to have selected the local currency option, the introduction of the option to select their home currency brings with it a number of benefits.

By selecting the home currency option (also known as dynamic currency conversion or DCC), consumers abroad can keep track of their spending by clearly seeing the amount of money that leaves their bank account at the point of purchase. As they are probably better acquainted with their home currency, this option readily enables them to identify value for money on a purchase abroad. All this helps avoid the use of difficult mental arithmetic at the point of transaction to work out what amount of money they are spending.

Consumers should be encouraged to do two things ahead of a trip abroad. In the same way as they would check rates at a bureau de change, before leaving they should additionally look at what card fees and rates are in the country they are visiting. In addition, they should also feel that they are able to ask the merchant questions about the rates associated to the options they are presented with at the point of purchase.

Just like advising consumers on all the essentials they should be aware of before they travel, from passports to visas to sun cream, it’s important they have a better understanding of what the choices are when using a card abroad so they are in a position to decide what works best for them.

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