Beware hidden fees!

One of our customers has just brought to our attention a hidden fee when using their card in Europe - in this case Austria.

There is a function that can be activated on EFTPOS machines that is called "Dynamic Currency Conversion" or DCC. This allows retailers to take an extra percentage when they are accepting cards from foreign countries - more importantly in a foreign country.

In this case our customer was charged an additional 10%!

So how can you avoid this charge?

The best way is to have a card that is already in the local currency - and make this clear to retailers when you are using it - so that they do not charge this extra "tourist tax".

In this example if you have a Cash Passport Card in Euros and make it clear that you are paying in Euros you will not be charged the extra fees. It's also worth pointing out that using your Cash Paspsort overseas at point of sale has no fees either.

If you have an Aussie EFTPOS or Credit card you will have no way around this and will be charged the retailer fee on top of your other bank fees

DCC doesn't seem to be that widespread yet but does appear to be growing in popularity with retailers (even here in Australia). Each retailer will set their own fee so it is hard to know whether 10% is standard or high but these hidden fees are here to stay.

Tipping Points

One of the things that overseas visitors like about visiting Australia is the fact that we don’t have an ingrained culture of tipping. Unfortunately the same can’t be said for Australians travelling overseas themselves. Whilst we are used to tipping in restaurants for superior service, we are not used to minimum expected tipping levels regardless of service levels or tips for people other than waiting staff.

When we are on holiday overseas the first time most of us even think about tipping is the sudden panic when the porter has brought your bags to your room: how much do you tip him, how much foreign cash do you have, where have you put that money?

Luckily there is an easy answer to this predicament. Simply by carrying some US one dollar bills you can get around these awkward moments. They are not worth much and no matter where you are going in the world staff in the tourism industry can change up US dollars easily. The best thing to do is to buy ten or twenty one dollar bills before you leave, it won’t cost you much but will give you piece of mind – don't even think of it as money but as a travel accessory to help you overseas like a money belt or electrical adapter.

Other tipping is sometimes harder to quantify and plan for, such as the service tip in a restaurant – although 15% will usually be fine. If you are on an organised tour there will probably be tipping that is not included in the price – for drivers, tour guides and maybe even tour directors. The tips may be payable in local currency or often in US dollars and will range from five to ten dollars a day depending on who it is for. This will be listed for you in the tour documents and it’s worth looking at these before you leave. The best thing to do is work out how much you are up for, buy it and keep it aside until the last day of your tour.

Some countries have their own systems of tipping. For example in Egypt this is known as Baksheesh and goes through all layers of society. Small amounts of tipping are needed for almost everything that you do - from receiving toilet paper in the toilets to being shown a statue by a member of the tourism police. It’s best to be prepared and get hold of some Piastres (cents) when you arrive which are worth only a small amount but are fine for these sorts of tips.

In general tipping is a necessary evil overseas and by being prepared you can reduce your culture shock and blend in without looking like a super rich tourist giving exorbitant tips – either by accident or design.