Dynamic Currency Conversion or DCC is a service where a cardholder is offered a choice at the point-of-sale to pay in their own currency during an eligible card transaction instead of the default currency offered by the merchant or dispensed at the ATM.
If the cardholder accepts the DCC offer, then the sale or cash dispense amount is converted to the cardholder’s billing currency at an exchange rate offered by the merchant (in conjunction with the acquirer and/or Global Blue). The transaction is then processed with the participating card scheme using the cardholder’s billing currency. Because the amount is already converted, the card issuer won’t need to convert it when they receive the transaction request for approval.
If the cardholder declines the DCC offer, then the transaction will be processed to the participating card scheme in the default currency. The card scheme or card issuer will convert the amount to the cardholder’s billing currency when the transaction is settled by the card issuer to the cardholder.
Global Blue adds a foreign exchange mark-up during the conversion which is funded by the cardholder. This foreign exchange commission is usually shared by the merchant, acquirer and Global Blue. DCC transfers the commission that would ordinarily be retained by the card scheme and card issuer to the merchant, acquirer and Global Blue.
DCC is regulated by the participating card schemes. Merchants, acquirers and Global Blue must be registered with the participating acquirers and comply with all DCC related card scheme rules.
