Over the past few weeks we’ve been eagerly contacting popular Dynamic Currency Conversion (DCC) services with the purpose of getting a better perspective of how DCC works and how it might be of benefit when traveling. We are aiming to have each profiled company answer three central questions: What is the typical currency conversion fee care holders should expect to pay when using your DCC service? What is your service area? What are the competitive advantages for choosing your DCC service over alternative currency conversion methods?

To lead us off, we got a detailed response from FEXCO, a global payments company headquartered in Kerry, Ireland, with operations in Ireland, the UK, Spain, Malta, Australia and the USA. The company was established in 1981 and offers a range of Global Consumer Payments, Global Corporate Payments and Business Services. Through its services, FEXCO moves over 4.5 billion pounds annually to consumers and companies in more than 150 countries worldwide.

Our questions to FEXCO are in bold font below:

What is the typical currency conversion fee card holders should expect to pay when using your DCC service?

In any assessment of DCC you must bear in mind that converting the value of a foreign transaction is not new. This practice has been performed quite secretly by the Issuing Banks and the Card Associations (VISA & MasterCard) since credit cards came into use. The real benefit of DCC is that the conversion is no longer done in secret. The conversion is carried out at the point-of-sale in full view of the cardholder and where all information on the conversion process is provided to the cardholder. The cardholder therefore can make a fully informed decision at the point-of-sale as to whether they wish to accept or decline the option of DCC (remember with DCC there is a CHOICE).

The CHOICE to pay in your own currency when purchasing goods or services in a country where the currency is different to that in which your card was issued - known in the credit card business as DCC - is a service that has, because of its cardholders benefits, found favour with many international travelers since it was pioneered by FEXCO nine years ago.

What is your service area?

FEXCO is the leading supplier of DCC to many household names in the T & E, retail and car rental sectors in both cardholder present and e-commerce environments. Currently operating in Ireland, U.K., U.S., Australia, Holland, Germany, Switzerland, Spain and France our role embraces exchange rate setting, treasury, settlement processing and bank interfacing.

What are the competitive advantages for choosing your service over the alternative currency conversion methods?

• We offer our foreign cardholders the choice of paying in their own currency.
• We offer the certainty that the amount signed for is exactly what will be charged on your statement - no surprises! No such certainly applies to transactions taking place in local currency with cardholders having to await the arrival of their statements to view the amount in their own currency after conversions by a combination of a card scheme such as VISA or MasterCard and their own card issuing bank. The Card Associations and the Issuing Bank do not reveal the source of their base rate on which they perform the currency conversion resulting in the cardholder never being fully aware of the exact margin applied to the transaction.
• Our service allows business travelers to file expense account claims in home currency immediately without having to wait for their credit card statement to include the converted amount.
• We advise card holders of the rate that will be used, the margin applied and importantly the source of our exchange rate (eg., Reuters or another alternative provider of wholesale interbank rates) as well as the sale amount in both the merchants local currency and in their own home currency.
• We provide a till receipt clearly showing the amount in local currency, the rate of exchange used, the origin of that rate and the final amount in cardholders’ own currency.

A recent survey by Visa indicated that 82% of cardholders approved of DCC and would continue to choose it at point-of-sale. This confirms our own view that a professional DCC service operated with probity, such as ours, is here to stay!