When banks are continuously under the microscope to treat foreign exchange consumers fairly and honestly, it seems rather strange that Cash Point service providers are immune to that high level of scrutiny.


I’m referring to the good old Dynamic Currency Conversion (DCC) function that seems to be sweeping across ATM networks with an agility only seen every four years in athletics.


DCC is a software utility that allows ATM service providers the ability to show a foreign traveler an instant exchange rate when they use a cash machine abroad.  It also shifts who gets to keep the revenue from the FX.  If the ATM provider is selling the foreign currency rather than the local currency then they keep the revenue, as well as any fees.  They can also set the exchange rate.


It sounds appealingly transparent. A consumer gets to see the rate of conversion immediately and walks away happy in the knowledge that they will recognise the charge come the day they sit down to check their monthly statement.

It’s clear and convenient but is it fair?

Our research highlights that 60% of customers who used a cash point whilst abroad accepted the DCC rate.


At that moment of choosing which button to press they’re unable to shop around and don’t have the tools to compare the final costs. I doubt that many know the owner of the ATM sets the conversation rate rather than their bank at home, and that in almost all cases they will get a worse deal than accepting the conversation rate post transaction by choosing to pay in the local currency.


The same applies for making credit and debit card purchases and choosing to pay in pounds. Our foreign exchange benchmarking research shows a third of Brits choose the option that will make them financially worse off.


Using legitimate customer concerns to make additional revenue doesn’t stack up with treating consumers fairly and with transparency.


Consumer Intelligence is helping Banks and ATM service providers understand the importance of treating customers fairly across all transaction channels. DCC could be a good thing but only when a consumer is making a decision based on knowledge and not a false inference. Used correctly, it offers a level of transparency that banks could use to restore customer trust.


[FREE REPORT] International Currency Transfers: a market on the cusp of change

Find out how and why consumers are using international money transfers. The latest Consumer Intelligence International Currency Transfers Survey reveals a market poised for change.

International Currency Transfers Report


andrew-bullerAndy Buller, Key Account Director and Head of Travel Money

Andy has over 20 years’ experience within the financial services sector and has worked predominantly within the FX, wholesale bank notes and prepaid industries. In previous roles Andy has managed key relationships with many of the leading financial institutions including Commerzbank, Credit Suisse, American Express, RBS and Travelex.




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