If asked, go local
When using your card abroad, whether at an ATM or directly with a retailer, your withdrawal or spend amount may be presented in sterling, as well as the local currency (e.g. euros or dollars). If this happens, always opt to withdraw or spend in the local currency. So for example, if you are in Spain, choose euros, in the United States select dollars or in Thailand work in baht.
What is dynamic currency conversion?
When an ATM or retailer offers you the option to pay in sterling, they are using something known as dynamic currency conversion or DCC. By using DCC, the provider is able to use its own exchange rate to convert the amount of local currency you wish to withdraw into sterling. The screen you see will vary from one ATM or retailer to another, but typically you will be shown a sterling amount for your withdrawal or payment and be asked if you would like to “continue with conversion”, “accept conversion”, “charge my account in GBP”, “withdraw in GBP” or “ withdraw in sterling”.
In almost all cases, choosing any of these options will be unfavourable and will cost you money, especially if you have already loaded the local currency onto a prepaid currency card such as the Post Office Travel Money Card.
Where does dynamic currency conversion happen?
You may come across DCC in many countries around the world, but be particularly careful if you are using ATMs in either Spain, Greece, Portugal, Croatia or Thailand. So remember, if you’re using an ATM or spending on your card abroad, always choose to withdraw or spend in the local currency.
