Credit Cards: Should You Pay in Euro or Dollars?


While shopping in Germany (or all of Europe) you may occasionally come across a business that affords you the option to pay using your credit or debit card in Euro or your home currency. Which one should you choose and why? Ask most people who have been around the block and they will quickly tell you to use the local currency. That answer is correct but why?

The culprit is know as “dynamic currency conversion” where the cost of the currency conversion is done at the point of sale and not by your card company or bank. The kicker is that the conversion rate is typically less favorable that what your bank would give and there is probably a conversion fee added to it. Even if your bank or card company charges a foreign transaction fee, the fee for using dynamic currency conversion is probably more.

You can get around this whole mess by paying in cash but your dollars will still be converted to Euro at some point. Just remember, if you are ever given the choice when using your card, opt to pay in the local currency. Happy travels!

1 Comment on Credit Cards: Should You Pay in Euro or Dollars?

  1. I had heard this too but there have certainly been a few times I opted to pay with Euro and it was actually cheaper!

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