Heathrow Duty Free

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Sumatra

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If you are purchasing from the duty free shops in Heathrow all prices are naturally in Sterling. When you go to the check-out they ask if you'd like them to charge you in Sterling or your own currency EURO.

I asked what the conversion rate would be and it seemed pretty good but I decided to pay the Sterling price using my Visa card.

On return home and on receipt of my Visa card statement I was pleased to see that the exchange rate Visa gave me was much better.
 
Same here - get asked this question in world duty free. I've found that some of the shops dont ask you though - but I alway's go in sterling and it works out on Visa.... and in any case its much cheaper than if I had to purchase it in Ireland!
 
This is something called "Dynamic Currency Conversion" - which Visa and Mastercard (but not AMEX) support

Basically the rules are that the merchant must offer you the choice of being billed in local currency or your home currency ... essentially the retailer is being given the chance to profit from the foreign exchange margin instead of the bank that issued your credit card.

As a general rule you should always refuse when given this choice as the rate you get will normally be far worse than your own bank will give you and would almost never be better.

If a retailer charges you in your home currency without giving you the choice you should complain - it's against the rules - http://www.visaeurope.com/merchant/operationsandsecurity/rulesandregulations/currencyconversion.jsp

NB our lovely friends are Ryanair are in breach of the above rules - if you book on their site using say a UK£ credit card to book a flight departing from Ireland they'll charge your card in £s at a crap rate rather than offering you the choice of being billed in €
 
Thanks EvilDoctorK, I wasn't aware of 'Dynamic currency conversion' and how it works for both consumer and retailer so that's great to learn. Hotels I stayed with seemed keen to offer the same service. Very helpful post and thank you.
 
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