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Exchange rate transparency for ATMs

7 Oct 2015
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As winter approaches, all that is left from the summer of 2015 are memories of the holiday for that annual glimpse of sun. For British sun seekers, Spain has historically been the most popular destination travelled to in search of friendlier climates, with the average holidaymaker quoted to have spent in the region of £1,076 per person on their main holiday in 2014.

Globally, it is estimated that British holidaymakers spent £35.5bn abroad in 2014, according to the Office for National Statistics (ONS). This figure is up around £3bn (10%) since 2012, a sign perhaps of the world recession coming to an end.

Another major factor of the increase in spend is the phenomenal power that the pound sterling has commanded over the euro during the last 18 months, with the pound now worth roughly 15% more against the euro than it was this time in 2013. It is estimated that up to £2.7bn should be saved by British holidaymakers by the end of 2015 compared to 2013 due to this increased value of the pound.


However, while the benefits of these preferential exchange rates are clear, there is the obvious drawback of using a different currency to that in circulation in every county you visit. Holidaymakers cannot instantly determine value on a purchase in a currency they are not familiar with, often using guess work and loose mental arithmetic to make an educated guess. Anything and everything you do while abroad is paired with the sense that these “euros” aren’t even real and so can be spent freely. This can be enjoyable ignorance – until you get home and realise that not even the strength of the pound can resurrect your holiday budget now. This is where Fexco’s currency conversion expertise can ensure a great holiday all within budget through DCC@ATM.

What is DCC@ATM?

Dynamic Currency Conversion for ATMs (DCC@ATM) is a service that allows customers to be charged for their ATM withdrawals in their home currency. Think of withdrawing cash abroad in a foreign currency. If the ATM you use is DCC enabled, you will be presented with a DCC offer to withdraw cash in the local currency but paying for it in your home currency – knowing at the time of withdrawal the amount you’ll be charged and the exchange rate – so the total cost of the transaction is clear to you at the time of withdrawing the cash.

You can choose to accept or decline the DCC offer. When DCC is declined, the exchange rate will be calculated at a later date by the customers card scheme, usually Visa or MasterCard and their card issuer i.e. the bank that issued their credit or debit card —leaving the rate unclear until applied and seen in your bank statement.

The key customer benefits of DCC@ATM are customer clarity in terms of both the amount paid for cash as well as knowing the foreign exchange rate applied at the time of withdrawal. For customers concerned about foreign exchange rates, this provides peace of mind and exchange rate transparency.

So, with DCC@ATM, a British holidaymaker in Spain could withdraw 100 euros from the ATM while their bank account back home is debited the corresponding amount in pounds sterling. The visitor has clarity on both the exchange rate that is applied and the cost to them of their 100 euros.


How does the ATM operator benefit?

Without DCC@ATM, fees and foreign exchange charges associated with foreign ATM cash withdrawals normally go to the credit card scheme and the ATM customer’s card issuer. With DCC@ATM, the foreign exchange calculation is done at the time of cash withdrawal by the ATM operator. This allows the ATM operator to provide the foreign exchange service and charge industry standard commissions on withdrawals from non-domestic customers. DCC@ATM is a win-win for operators as it creates a new revenue stream while improving customer service for foreign visitors.

How is DCC@ATM implemented?

Fexco works with ATM operators globally to offer DCC@ATM. Fexco’s Mercury system enables ATM operators to provide real-time DCC offers to their customers by using our comprehensive BIN database to determine the customer’s home currency and matching it with current foreign exchange rates.

Fexco’s Professional Services team will guide ATM operators through every stage of the implementation process to ensure rapid development as well as ensuring that DCC offer screens and receipts meet credit card scheme rules.

Fexco’s DCC@ATM

So, as we look forward to quietening the whispers of recession, take a moment to think about how your ATM business can benefit from foreign visitors and start to get a share of the $1.088 trillion global tourism spend. If this sounds like something your business is interested in and you’d like to know more about how your company can offer DCC@ATM, contact our Strategic Business Development Manager, Shane McElroy at Fexco.

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