Mastercard bans a conversion con on its prepaid cards which strips millions of pounds a year from British travellers
- Tourists are routinely offered a chance to pay in their ‘home’ currency
- This process is called ‘dynamic currency conversion’
- Such conversion rates are expensive, as the Mail on Sunday warned last week
Travellers using a prepaid Mastercard will now be protected from a money-sapping trick
Travellers using a prepaid Mastercard will now be protected from a trick that strips hundreds of millions of pounds a year from Britons’ holiday budgets.
Tourists are routinely offered a chance to pay in their ‘home’ currency at restaurants, shops or hotels abroad in a process called ‘dynamic currency conversion’.
The same choice is offered if you withdraw money from a cashpoint.
But such conversion rates are expensive, as The Mail on Sunday warned last week when it exposed key travel money traps.
Customers with prepaid cards who say yes to paying in sterling are hardest hit, being double-charged for currency exchange – first when they load them with holiday money, then when they pay in pounds rather than the local currency.
Mastercard has banned this practice by amending its contracts with global banks.
Alana Parsons, of prepaid card provider CaxtonFX, says this ‘offers greater protection’ adding: ‘Hidden conversion charges can add 7 per cent to a bill.
So pay in local currency, no matter what the method.’