At a foreign ATM or card machine you may be asked: pay in local currency or in your home currency (rupees)? The second option is Dynamic Currency Conversion, DCC. The rupee figure can look convenient. It means the merchant's or ATM operator's bank sets the exchange rate, and Visa notes the offer "includes exchange rate and additional fees".
What Visa and the 2025 Mastercard guide say
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Visa says merchants and ATMs should show the amount in both currencies, the exchange rate, and any markup or fees, and must give you the choice rather than choosing for you. If you do not see those details or feel pushed, Visa recommends declining the conversion and reporting it to your card issuer. Declining does not stop you buying or withdrawing.
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Mastercard's DCC guide says that if you pick local currency, the conversion uses your card issuer's rate; if you pick your card's billing currency, the acquirer's rate applies. It also says the choice must not be framed as accept/decline, the PIN must come after the currency choice, and DCC must not be applied without consent.
Before you select a currency
- At the screen, choose the local currency (the one of the country you are in).
- Read the screen: two amounts, an exchange rate, a fee line. If you see only your home currency, or a yes/no button, stop and cancel if you can.
- Keep the receipt. Check it matches your choice.
- If DCC was applied without your choice, ask the merchant to void it, and raise it with your card issuer. Mastercard's guide states cardholders have chargeback rights when DCC is applied without consent, and that receipts saying the choice is "final" should not discourage a dispute. Ask your issuer about the applicable dispute process and deadlines. A chargeback is not a promised refund.
- Prepaid multi-currency travel cards: Mastercard says DCC should not be offered on cards already loaded in foreign currencies. If it is offered, decline.
What this post does not claim: the actual fee or exchange-rate difference on your card. That depends on your issuer. Check your bank's foreign-transaction charge schedule.
Sources and scope
Visa: Dynamic Currency Conversion | Mastercard DCC Performance Guide, 2025 merchant version
These are network materials, not an RBI rule or a guarantee of savings. Mastercard says its guide is not a replacement for its transaction rules; applicable network rules govern if they differ.
Quick questions
What is DCC? An offer to pay in your card's home currency at the foreign terminal; the conversion is done by the merchant's or ATM's side (Visa, Mastercard).
Which currency should I choose? Local currency, then your issuer converts. Compare the issuer's charges first.
Can they pick for me? No. Visa and Mastercard standards say the choice must be yours.
Will declining block my purchase or withdrawal? Visa says it will not.
What if it was applied without asking? Ask to void; keep the receipt; contact your issuer. Mastercard says chargeback rights exist for DCC without consent.
Does this apply to online and hotel payments? Yes; Mastercard's guide covers POS, ATM and online, and gives a hotel example. Check the currency shown before paying.
A Miranda House graduate and lawyer who traded courtrooms for slow travel. Cheshta travels with the batches we host ourselves, with a soft spot for travelling alongside elders.
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