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DYNAMIC CURRENCY CONVERSION (DCC)



DYNAMIC CURRENCY CONVERSION (DCC)



WHAT IS DYNAMIC CURRENCY CONVERSION?

Dynamic currency conversion (DCC) or cardholder preferred currency (CPC) is a feature which will enable you to make a purchase on the spot or known as Point-of-Sale (POS) even when you are overseas by using your home country currency. 


BENEFITS OF DCC 

DCC helps to save time and other resources which usually spent on converting the cash e.g. to a Money Changer, in order to make a purchase overseas.

DCC presents such transparency by allowing the cardholder to see the currency rate and the exact amount of money will be spent on that purcahse. Such transparency does not support with a standard credit card.


picture source link


HOW DCC WORKS  

Most currency conversion fees are charged by the credit card payment processor (usually Visa or MasterCard) or ATM network. DCC fees are charge by the merchant, typically through a service provider.

DCC MODEL 



DCC FEES 

As mention before, DCC offer the cardholder such transparency with the currency rate. This service is charge on top of the card currency conversion fee. 

In most cases, DCC markups are higher than the card issuer's currency conversion fee. 

Moreover, DCC allows the merchant, merchant's bank or ATM operator to charge a markup on the exchange rate used, sometimes by as much as 18%. see here




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