'New-Ish' Credit Card Scam

[pedro01]

All

Not sure if this has been mentioned here or not.

I've been noticing something for a while with credit cards. Up to now, it's been mostly hotels & hospitals up to it but today they tried it at a bloody sports shop.

It's not a scam per se but it will cost you $$$. Basically, they'll put your purchase through on your card, you'll see the Thai Baht amount on the receipt but you'll also see USD or GBP amount. Today the shop receipt was 3,000 Baht which was about $100. Looking at the receipt, the shop charged my card in USD and used the rate of 29.195 Baht to the dollar, current rate is 30.28.

I know to check this in hotels but this is the first time I've seen it in a regular shop. So - that's roughly 3% extra you are paying on top of your purchase for the shitty exchange rate.

If you see this - do what I do. Insist they reverse the original charge & charge you again at THB. Your bank will give you a much better rate. They will do it with no fuss as they know full well they are creaming you for an extra 3%.

Pedro

[lopburi3]

But remember your home bank is likely to be charging a foreign currency conversion fee of 1-4% so you may still be paying the piper.

[pedro01]

But remember your home bank is likely to be charging a foreign currency conversion fee of 1-4% so you may still be paying the piper.

Have you ever actually calculated the rates given when you spend money on a card & you let the card company do the conversion?

I have - in all cases it has beaten any counter exchange rate you get.

I thought this was common knowledge.

[Phil Conners]

It has been mentioned many times before. It's not a scam but a service offered by the card companies so that customers (tourists) know exactly what they pay in their home currency rather than taking a chance on the exchange rate.

The customer is of course always free to pay in the local currency, just ask for it.

[Penkoprod]

Seems to me, its just a loophole to get the customer to stump up the 3% the credit card companies charge the vendors, thats illegal to impose "up front"

Penkoprod

[NancyL]

You should know the foreign transaction fee rate of the financial institution that issued your credit card. Many U.S. institutions charge 3%, but our credit union charges just 1%, so we always insist that a Thai business reverse USD charges and resubmit in Thai baht. Sometimes this creates much consternation and I hope we help everyone save face by being polite but insistent. Credit-unions are owned by their members, so we receive a rebate each year that depends upon the profits of the credit union. So far, it's been about 1-1.25% of our "activity" and the Visa card charges count as "activity", so basically we aren't paying anything extra for the foreign transaction.

Billing in GBP or USD isn't really a credit card scam. It's a "legitimate" business practice and something that all foreigners should check whenever they use a foreign-issued credit card.

[pedro01]

It has been mentioned many times before. It's not a scam but a service offered by the card companies so that customers (tourists) know exactly what they pay in their home currency rather than taking a chance on the exchange rate.

The customer is of course always free to pay in the local currency, just ask for it.

So - it's an unrequested service that puts 3% onto your purchase price?

And that's NOT a scam???

BTW - I've been here more than a decade and I have seen a sharp increase in this practise over the past 12 months.

[Phil Conners]

It has been mentioned many times before. It's not a scam but a service offered by the card companies so that customers (tourists) know exactly what they pay in their home currency rather than taking a chance on the exchange rate.

The customer is of course always free to pay in the local currency, just ask for it.

So - it's an unrequested service that puts 3% onto your purchase price?

And that's NOT a scam???

BTW - I've been here more than a decade and I have seen a sharp increase in this practise over the past 12 months.

For some tourists it may be more important to know exactly how much they spend in their home currency than to save a little on the exchange rate. If you don't want that service you're free to pay in the local currency, just say so. I don't see why it becomes a scam.

[lopburi3]

But remember your home bank is likely to be charging a foreign currency conversion fee of 1-4% so you may still be paying the piper.

Have you ever actually calculated the rates given when you spend money on a card & you let the card company do the conversion?

I have - in all cases it has beaten any counter exchange rate you get.

I thought this was common knowledge.

Yes and my last transaction had a 3% foreign transaction fee of $180 by my home bank - the exchange rate was that specified by Visa for that day. And I have posted about the local practice many years ago when it was very uncommon.

[TheFishman1]

Good advice I always when travelling have them put it in there currency for I always get a better rate from my credit card even after they charge a foriegn exchange fee.

[JimGant]

Plenty of information on this forum on Dynamic Currency Conversion (DCC), including which well-known merchants are using it. Some will automatically use DCC without your permission -- then say they can't reverse it (which is bs). Consensus is, always accompany the handing-over of your farang plastic with the instruction "baht," as you'll never ever come out ahead with DCC,

But remember your home bank is likely to be charging a foreign currency conversion fee of 1-4% so you may still be paying the piper.

With DCC you'll be paying an added forex spread that strictly benefits the merchant and his servicing bank. But, your issuing bank and their Visa or MC networks certainly are not relinquishing any fees when the merchant is allowed, under DCC, to use his own, unfavorable conversion rate. In fact, the term "foreign conversion fee" was changed to "foreign transaction fee" with the advent of DCC -- in acknowledgment that conversion is taking place elsewhere. But, you'll not see a difference in fees from the issuing end whether DCC is being used, or not.

Google on 'dynamic currency conversion' for some interesting reading. And search this forum also.