On the positive, it lets you know (probably) how much you're going to spend, in your own currency. I say 'probably' because you might get hit by fees from your own bank for using an overseas ATM as well. But it's not free.
So you could look upon it as being offered a paid service, and IMHO it shouldn't be used without the customer being made aware of this.
The reason you will be asked if you'd like to pay in your currency is not really anything to do with your convenience though, it's about who gets to do the conversion and who gets to pocket the (inevitable) fees. With DCC the merchant and their (acquiring) bank get to take the fees and set the rates. Without this, your (issuing) bank does. At some point one of the acquiring banks realised that they get to see the transaction before it gets back to the issuing bank, and so they have the power to do this stuff, so DCC was born.
I should say it's possible, however unlikely, that DCC could turn out cheaper. The article does give a great reason why this is unlikely though - if there's one set of people more eager to screw you over than your own bank, it's someone else's bank.
Check with your bank before you travel. I'm with Citibank, and they have a bunch of packages that they can enable on your account for free that remove foreign transaction fees (e.g., if you're a student; if you have more than 50k in cash; if you have a mortgage with them; etc.).
But, it being a bank, it's not like they're going to enable that stuff unless you ask for it first, and don't even think about getting it waived when you get back...
That simply isn't true in my experience. For years, I used a debit card from Nationwide in the UK to withdraw currency all over the world. They used the VISA wholesale rate with no vig added on top and no fees for ATM use. In total, I withdrew probably over ten thousand dollars on that card, and it was one of the most convenient currency conversion systems I have ever used. (The card now carries fees for the service).
On the other hand, going to a high street bureau de change would have been much, much less convenient and would have secured me a worse rate in every case. Traveler's cheques would have been both inordinately expensive and hideously inconvenient. In fact, in the absence of a local bank account in each country I visited, I'm still not aware of cheaper way to convert currency than the system I used.
If you travel a lot and can find a bank or credit union that won't charge you any fees, hidden or otherwise, you get great convenience and an excellent price.
Yep, you and thousands of others. Unfortunately expats ruined it for everyone else, simply using it as a way to draw money from their UK accounts when retired in Spain or wherever, never giving a penny to Nationwide. They probably made a loss on each of these customers so they withdrew the service.
They really just charged the Visa wholesale rate for ATM withdrawals and purchases abroad with no fees or markup or anything. It was fantastic.
If I withdraw money from a Barclays ATM in London (or Deutsche Bank in Berlin, etc) using my BofA ATM card, I don't seem to have an extra charges.
2. Some people like to have local currency before they enter the foreign country so they don't have to rely on finding a reliable local ATM before they can spend cash.
2. Depending on where you're from, some countries won't even grant you a visa unless you show them proof that you have sufficient foreign currency (e.g. Germany requires this of South Africans applying for a Schengen visa)
3. Specialist banks offer you additional benefits, e.g. Bidvest gave me 2 electronic bank cards to access funds in a separate, new, account when I travelled in Europe, which had 4 distinct advantages:
* lose one card I have a spare (my local bank couldn't offer that, nor would AMEX)
* my cards were not linked to my 'real' cheque account, protecting me in the event of theft and ensuring I had a backup plan if something really bad happened.
* I could protect myself from currency fluctuations by choosing to hold an account in a currency of my choice, e.g. EUR; if the exchange rate got worse, I used the EUR card, if it got better I used my local bank's credit card
* managing my budget was easier because I had allocated funds for the trip to my new travel account
The bank are always apologetic when I return. But so what? I don't want to spend 45 minutes on the phone to somebody in the airport in a foreign country. It's time-consuming, and ridiculously expensive. So I go to the bureau de change.
I've found bureaux de change to give better exchange rates anyway - mostly. Shopping around can be worthwhile, as the favourability of the exchange rate seems to be inversely proportional to the convenience and salubriousness of the place.
One more rule...Never use an ATM in a strip club. They're the lords of exorbitant fees, stuff like "$20 or 10% of the withdrawl, whichever is greater".
For a credit card, Chase Sapphire Preferred has no foreign transaction fees, and they waive the $95 annual fee for the first year.
For credit cards, most Capital One cards also have no foreign transaction fees. This site was quite helpful: http://www.nerdwallet.com/blog/top-credit-cards/nerdwallets-...
In countries like India or Russia this fee could be up to 20% from the amount requested for foreign cards.
If you're asking for a currency exchange, you will be charged for this operation separately. The exchange rate will be what this particular ATM is programmed with.
Any bank charge extra for each operation.)
Another card to look at is Charles Schwab's checking account. No forex fee and they refund all ATM fees, including foreign ATMs. No monthly fees or minimums on the account either.
Those two cards have saved me a ton of money in the last few months.
In short, my experience has been that East Asian banks don't rip you off with exorbitant fees. They have terrible wait times and truckloads of annoying paperwork to do anything, but they're very restrained about fees.
Europe? We'll find out in a month or so.
Are you guys cheaper than Oanda? Do you plan to offer GBP->USD? (As a US citizen working in London, this is all I want.)
Thanks for your comment and nice words. We're constantly working on new currencies and USD definitely high on our priority list. If you drop us an email to support [at] transferwise [dot] com we'll let you know as soon as it goes live. ;)
One look and I saw the massive rip-off for what it was(conversion from Czech Crowns into Swiss Francs) and avoid Citi ATMs like the plague since then.
As I recall the difference on withdrawing the equivalent of 500EUR would have been an additional ~50EUR for the convenience.
Thanks, but my local bank does such conversions just fine.