Dynamic currency conversion at Cathay ATMs

Taiwan Living in Taiwan
1

I think I’ve noticed a weird thing recently while using my UK cards at Cathay United ATMs. Since a couple of years ago, Cathay ATMs have been offering the DCC “feature”, where you’re presented with the option to have your card debited in your home bank currency rather than TWD or whatever.

This is normally a shitty deal anywhere in the world (because they just add a loading to the exchange rate so it works out as several GBP/EUR/USD more expensive), but I’m 90% sure that the last couple of times the DCC rate has actually been slightly better than the Mastercard rate offered by my bank, i.e., I would have been charged less in GBP if I’d accepted the conversion.

I usually skip past that screen and I forgot to take a picture again today, but I think the DCC amount was around £288.xx for NT$11k, as opposed to the £290.07 I was actually charged for rejecting the conversion.

Has anyone else noticed this? I remember there’s a couple of people here who regularly withdraw from foreign cards.

2

Wait a minute, sounds like the 5 cents NY, 10 cents Michigan arbitrage.
You might have something here.
Just exchange money back and forth.

3

Maybe your credit card actually has a really bad rate? I remember Mastercard having their own rate which can be quite far away from the market rate.

EDIT: For example: VISA vs. Mastercard yesterday:

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Both assuming a 0% bank fee.

Or maybe the DCC doesn’t include the ATM fee (if any)?

4

Nah, it’s not that. The Mastercard rate with no additional fee offered by Starling, Monzo, etc. is quite competitive. I believe the interbank rate is slightly better (this is offered by Revolut, except at weekends and for certain currencies where they charge additional fees that make it much worse), but the Mastercard rate is still pretty good.

Mastercard and Visa seem pretty comparable too. Your date is slightly in favor of Visa, but I found other dates where it’s the opposite. It just seems to vary from day to day which is better:

For NT$11k:
April 5: £293.41 for Mastercard vs. £293.74 for Visa
April 11: £291.90 for Mastercard vs. £293.10 for Visa
April 13: £292.53 for Mastercard vs. £290.86 for Visa
April 14: £290.74 for Mastercard vs. £292.37 for Visa
April 20: £290.07 for Mastercard vs. £289.44 for Visa

I don’t think there should be any additional fee. Cathay ATMs don’t charge a fee for foreign cards (which is why I almost always use Cathay ATMs), and if I chose the DCC option I don’t think there would be a fee on my home bank end (I assume the card would just be debited in GBP as usual).

It’s just a bit weird. I’ve never seen that before. I might go and try again tomorrow to see if DCC is really a better rate for some reason.

5

Oh, I should note as well that I’ve been using the same card for years and this is a new thing - usually I withdraw as close to my daily ATM limit (£300) as I can get it, and the DCC amount sometimes ends up slightly higher than that. It’s usually a few pounds (maybe 1-2%) higher than the amount charged based on the Mastercard rate.