Bad conversion rate??


#1

I had a few drinks in a restaurant in Peru and the bill came at S/. 41.00 or the equivalent of roughly £10.09 at today’s rate…I used my Revolut card after they confirmed they accepted MasterCards…the receipt also shows that the correct amount in Peruvian sols was entered…however when I checked the transaction in the Revolut app I noticed that the overall charge was £12.11 and not £10.09…any ideas why?? The conversion rate is also not shown on the Revolut app, just the £12.11… am I doing something wrong? I just entered my pin on the card machine and that’s it…
Thanks in advance…


#2

Btw, I’m not too fussed about the £2 difference but I thought Revolut were supposed to provide good rates…


#3

When the payment in your app does not appear in the local currency, it sounds to me like the merchant applied DCC (direct currency conversion). Always pay in the local currency. Search this forum for DCC to get more insight into the matter if you like.


#4

It does sound here like the merchant may have charged you in Sterling and applied their own mark-up.
If the charge comes back to your Revolut account in £ it won’t show the conversion rate, but it will if you were charged in the local currency (I assume your base currency is £ here).

The merchant is not supposed to do this without giving you the option, but once or twice I’ve actually been given a receipt in local currency to then subsequently find it charged back in GBP at a higher conversion rate.
I’ve even used one PoS terminal displaying the local charge (which I’ve authorised) - and then gotten a receipt showing both(!) a local currency and Sterling transaction value but no indication which one was actually applied (I didn’t notice this until later).
The Sterling one was then charged to my account without authorisation in this case.

The local currency / currency conversion option is definitely something to watch out for using a UK card - a merchant might put through the charge in Sterling without your permission, whether this is intentional or not by them.

I think sometimes they might have just clicked through and agreed it themselves without thinking / understanding exactly what is being asked on screen in some cases.

Hope this helps


#5

Thanks for the advice! It is very difficult to know whether the merchant has applied the direct currency conversion especially since everything is in another language…I’ll check out the information about DCC but is there anything I should look out for when the merchant hands me the card machine to enter my pin to make sure that DCC isn’t applied?

Thanks again


#6

Often (but not always the case) the terminal will switch to English when a UK card is detected.

It should ask you whether you want to accept DCC, or whether you want to pay in local currency. It may tell you an exchange rate. Terminals in Spain for example do this nearly every time.
For the Revolut card you should select to pay in local currency.

If they hand you the terminal and it is already in £, then they may have already selected it for you, and you can ask to cancel the transaction and do it again in local currency.

A couple of times though, I have authorised payments that have appeared in the local currency and then been changed to Sterling later. I wonder if the question comes up after the terminal was handed back. It’s uncommon though.

Agree that language can sometimes be an issue in these cases.
As it happens so infrequently and the difference in value not that high, I tend to just let it go - it’s normally still cheaper than using most UK debit cards :slight_smile:


#7

Yes, it is confusing sometimes. But the terminal should show you the right amount in the right currency when you enter your PIN. If the terminal does not show the local currency, the merchant should cancel the payment and start it again without DCC.


#8

Ok great - I’ll make sure the amount is in the local currency before putting my PIN in. If it’s not, then I guess I need to practise my Spanish anyway!

Thank you again!


#9

…deleted reply


#10

It’s not DCC! I’m in Peru right now and I consistently got overcharged 20% on all 4 of my restaurant payments!
I’m now waiting for Revolut to start the charge back process.