When paying abroad, a simple detail on the ATM or the payment terminal can dictate whether it spends the right amount or eventually pay more than it should. The choice between local currency and euro, often made by convenience, can activate hidden rates that make the transaction more expensive.
According to the Spanish newspaper As, the mechanism is called the Dynamic Conversion of Currency (CD) and is presented as a convenient and transparent service, allowing the customer to immediately see the converted value. However, the conversion is done by the terminal company, with rates often higher than those applied by banks, resulting in an added cost to the user.
According to the same source, this is the mistake thousands make when making payments abroad: choosing the wrong option at the terminal or crowd, without realizing that this activates a currency conversion with much higher rates. This automatic gesture, made by convenience or ignorance, end up with each transaction and, in the accumulated of vacation, represents an extra significant expense.
Why are there no clear alerts?
National banks do not usually warn you to this risk, as they do not profit directly with the CD, thus avoiding conflicts with international banks or operating companies of these systems. Already the companies responsible for the payment terminals benefit higher committees whenever customers choose to pay in euros.
For this reason, experts advise to always select the local currency when making payments abroad. Thus, it is the customer’s bank that manages conversion, applying usually lower and transparent rates.
Digital payments and technical limitations
In many countries, payments with Apple Pay or Google Pay are accepted smoothly. However, in rural areas or outdated equipment, especially in the United States, NFC technology may not work. In these cases, the only solution is to have the physical card to complete the purchase or supply fuel.
Small gestures make a difference
According to the, paying attention to what appears on the terminal screen, choosing the local currency and traveling with physical cards are simple precautions that can make a difference in the holiday budget. They avoid unpleasant surprises and ensure that it pays only the fair value of purchase or service.
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