Dynamic Currency Conversion
Dynamic Currency Conversion (DCC) is a process that allows cardholders to choose the currency they want to use for their international transactions. When a cardholder is traveling abroad and makes a transaction in a foreign currency, the transaction is automatically converted into their home currency at the point of sale or ATM. This is done using a currency conversion rate that is determined by the card issuer or the ATM operator. It is a feature that has been gaining traction in recent years and can be very beneficial to Canadian ISOs. Let’s take a closer look.
- Increased Revenue
One of the main benefits of DCC is increased revenue. When a cardholder chooses to use DCC, the ATM ISO/Operator receives a percentage of the currency conversion rate as a commission. This commission can range from 50% to 70% of the DCC margin. By offering DCC, ATM ISOs can increase their revenue simply by ensuring their ATMs are updated with the latest DCC certified ATM application software. It is a major benefit that with DCC activated, the ISO can increase their revenue without having to increase the number of transactions.
- Competitive Advantage
Offering DCC can give ISOs a competitive advantage. With the rise of digital payments and online banking, consumers are becoming more aware of the fees associated with international transactions. By offering DCC, ATM ISOs can attract more customers who are looking for a transparent and cost-effective way to withdraw cash when traveling abroad.
- Reduced Chargebacks
Another benefit of DCC is reduced chargebacks. Chargebacks occur when a cardholder disputes a transaction and requests a refund. In international transactions, chargebacks can occur if the cardholder does not recognize the foreign currency amount on their statement. By offering DCC, ISOs can reduce the number of chargebacks by providing cardholders with a clear and transparent currency conversion rate.
- Improved Customer Experience
DCC can also improve the customer experience. When a cardholder chooses to use DCC, they have more control over their transaction and can see the exact amount that will be deducted from their account in their home currency. This can help to prevent any surprises when the cardholder receives their statement. Additionally, DCC can help to reduce the complexity of international transactions, making it easier for cardholders to withdraw cash when traveling abroad.
- Enhanced Security
Finally, DCC can enhance security. When a cardholder chooses to use DCC, the transaction is processed in their home currency, which reduces the risk of fraud and errors associated with currency conversion.
It is important to note, however, that not all cardholders may want to use DCC. Some may prefer to use the local currency of the area they are in. ATMs should therefore offer both DCC and local currency options to cater to the needs of all cardholders. But, the benefits are clear, and ISOs looking to increase their revenue and offer a better customer experience should consider offering the DCC feature.
Global Processing Centre offers DCC for both Visa and Mastercard transactions. Contact us to find out how we can add this feature to your fleet of ATMs
