What is Dynamic Currency Conversion (DCC)?

It is a service offered by merchants that allows you to pay in your home currency. It is a trap; the merchant sets the exchange rate, which is almost always much higher than the standard bank rate.

Should I use a debit card or credit card?

Use a credit card for all purchases for better fraud protection. Use a debit card only for withdrawing cash at legitimate bank-branded ATMs.

How do I know if I'm being charged a fee?

Check your monthly statement. If you see a separate line item labeled 'Foreign Transaction Fee' or 'International Service Fee', your current card is not fee-free.

Avoiding foreign transaction fees when you travel

Avoid foreign transaction fees by opening a travel-friendly debit card or credit card that explicitly advertises 'no foreign transaction fees' in its terms. Always decline the option to be charged in your home currency if a merchant or ATM offers 'Dynamic Currency Conversion'.

Audit your current cards. Check the back of your cards or log into your online banking portal to read your 'Cardholder Agreement'. Search for the term 'Foreign Transaction Fee'. If it says 1% to 3%, plan to replace that card for travel.
Apply for a no-fee travel card. Look for credit cards (like Chase Sapphire Preferred or Capital One Venture) or debit cards (like Charles Schwab or Fidelity Cash Management) that charge 0% on international purchases. Apply at least 3 weeks before departure to account for shipping.
Set up account alerts. Log into your banking app and set up transaction notifications for every purchase. This helps you track exactly how much you are being charged in both local and home currency.
Decline dynamic currency conversion. If a card machine at a shop or ATM asks if you want to pay in your 'Home Currency' or the 'Local Currency', always choose the Local Currency. The machine's exchange rate is almost always significantly worse than your bank's rate.

What is Dynamic Currency Conversion (DCC)?: It is a service offered by merchants that allows you to pay in your home currency. It is a trap; the merchant sets the exchange rate, which is almost always much higher than the standard bank rate.
Should I use a debit card or credit card?: Use a credit card for all purchases for better fraud protection. Use a debit card only for withdrawing cash at legitimate bank-branded ATMs.
How do I know if I'm being charged a fee?: Check your monthly statement. If you see a separate line item labeled 'Foreign Transaction Fee' or 'International Service Fee', your current card is not fee-free.