What Is Dynamic Currency Conversion (DCC)?
Dynamic Currency Conversion is an option offered at card payment terminals and ATMs abroad that lets you pay or withdraw in your home currency instead of the local one. It's usually presented as a convenience; in practice it almost always costs more than paying in the local currency.
How it works
At checkout, you're asked whether to pay in the local currency or your home currency. Choosing your home currency means the merchant's bank, not your own bank, sets the exchange rate on the spot, and that rate includes a built-in markup.
Why it usually costs more
The merchant-set conversion rate typically includes a margin of several percent above the real interbank exchange rate. Your own card issuer's conversion, by contrast, is usually tied closer to the real market rate, though your card may still charge its own separate foreign transaction fee - a different cost from DCC.
How to avoid it
Always select the local currency option when prompted at a terminal or ATM, even if the home-currency total is shown first or more prominently on the screen. At ATMs, decline the conversion prompt and choose to withdraw in local currency.
Is it ever worth it?
Rarely. The only scenario where DCC might help is wanting price certainty at the exact moment of purchase, and being willing to pay the markup for it. For virtually all routine travel spending, paying in local currency through your own card issuer's rate works out cheaper.