DCC – Consumer/Cardholder Choice Rules

The fundamental principles of DCC regulations are that the consumer has a choice and the terms and conditions associated with DCC are fully disclosed. That is, the consumer is given the choice to either accept or decline the DCC service and all relevant information is available prior to the consumer making an informed decision.

Issuers have a Chargeback right if their cardholders confirm in writing they were not given the choice to accept or decline DCC.

Consumer/Cardholder Choice

To ensure consumer/cardholder choice, the following regulations regarding how the DCC service is offered must be followed:

  1. The default transaction currency must be the customer’s pricing currency.
  2. Consumers must opt in to the DCC service. The customer must inform the consumer that the DCC service is optional.
  3. The customer must not use any language or procedures that may make paying in the customer’s pricing currency difficult.
  4. The customer’s must not use any language or procedures that cause the consumer to choose DCC by default. A consumer may not be required or encouraged (i.e., “steered”) in any manner to use the POI currency conversion. For example, a POS Terminal must not ask or require a consumer to choose to have the Transaction completed in a particular currency, whether by selecting “YES” or “NO” or by displaying different currency selections in red and green colours, or otherwise.
  5. The customer must not make claims for the DCC service that are incorrect or cannot be substantiated.
  6. The customer must honour the choice of the consumer.

What needs to be shown to a consumer before they make a choice?

The following information must be made available to the consumer when they are being offered DCC, prior to them making their choice and completing the Authorisation or pre-Authorisation taking place:

  1. The transaction amount in the customer’s local pricing currency with the relevant currency symbol or code e.g. € or EUR *
  2. The Transaction Amount in the cardholder’s Billing Currency with the relevant currency symbol or code e.g. $ or USD *
  3. The Exchange Rate used to convert the Transaction Amount from the customer's Pricing Currency to the cardholder’s Billing Currency *
  4. The Source of the Reference Exchange Rate used to calculate the Exchange Rate – e.g. Rates provided by U.S. Bancorp
  5. The Mark-up applied to the Reference Exchange Rate when calculating the Exchange Rate used to convert from the customer’s Pricing Currency to the cardholder’s Billing Currency, this will be set at a customer’ level e.g. Mark-up of X% included in rates (set at a merchant level)
  6. For unattended POS Terminals the POS device must clearly disclose the following statement, verbatim to the Cardholder for MasterCard DCC Transactions:
    "MAKE SURE YOU UNDERSTAND THE COSTS OF CURRENCY CONVERSION AS THEY MAY BE DIFFERENT DEPENDING ON WHETHER YOU SELECT YOUR HOME CURRENCY OR THE TRANSACTION CURRENCY.”

The above statement for Unattended POS terminals can be displayed on the Screen of the unattended POS or it may be printed on a quotation receipt. If an unattended POS Terminal cannot comply with the Cardholder disclosure requirements set forth above, the customer must satisfy the requirements by some alternative means designed to ensure that the consumer/Cardholder understands POI currency conversion before the consumer/Cardholder is asked to decide the currency the Transaction is to be completed in.

*Minimum screen requirements for DCC message.
If the minimum requirements are only displayed due to screen size, then a “Print Quote” option must be available so that a quote receipt can be provided to the consumer which includes all the required information in order for them to make their choice.

In summary, to be compliant the cardholder must be presented with a screen that provides the below:

  • Local Amount Currency
  • DCC Amount and Currency
  • Exchange Rate
  • Mark-up%
  • A clear question – e.g. Select Currency?
  • A clear way for the cardholder to either select or reject DCC

What should the “DCC Quote” look like?

  1. Sale amount: Displays the local amount of the transaction with the currency symbol.
  2. Conversion rate: This is the exchange rate including the mark-up that is used to convert the transaction into the DCC currency.
  3. Mark Up %: Displays the mark up as a percentage e.g. 3.5%.
  4. Final amount: Displays the DCC amount of the transaction with the currency symbol.
  5. Disclaimer: This tells the consumer where the rates are sourced from and what mark-up % is included in the exchange rate.