How to Reduce Your Cash Conversion Fee

When a business has a high cash conversion cycle, it can have a negative impact on its day-to-day operations and investment potential. A business can reduce its cash conversion cycle by allowing customers to pay on credit terms and offering discounts for early payments. 문화상품권현금화

It is a hidden fee that you can avoid by refusing to allow the ATM to conduct currency conversion when you withdraw cash abroad.

Bank or credit union

Banks and credit unions typically offer their checking account customers currency exchange services online, by phone or in person at lower rates than other sources. They also reimburse foreign ATM fees incurred while traveling (see NerdWallet’s best banks and credit unions for details).

Some debit card payment processors and ATM networks charge a fee called dynamic currency conversion, or DCC, on purchases made in a different country’s currency. It isn’t the same as a foreign transaction fee and may be charged in addition to your bank’s standard ATM or card fees.

Before you leave home, check your debit or credit cards’ terms of service and fees. Some cards, including those issued by major banks like TD Bank and Capital One, don’t assess foreign transaction fees at all. Others, such as the Costco Anywhere Visa Card by Citi and the Citi Double Cash Card, assess them at a rate of up to 3%. And many ATMs outside the United States tack on their own fee in addition to your card’s fees and the currency conversion charge.


If you have a premium checking account, such as those offered by Axos Bank, Alliant or Charles Schwab, you can avoid ATM fees when traveling internationally. These accounts offer unlimited domestic ATM fee reimbursements, which appear on your monthly statement as one lump sum.

Whenever you withdraw money from an ATM abroad, the machine will ask whether you want to withdrawal with or without currency conversion. Choose the option without currency conversion to let your card’s bank or the card network handle the transaction, which will give you a better exchange rate.

However, if you decide to use the with conversion option, the ATM or the bank handling the transaction will apply a Dynamic Currency Conversion (DCC) fee*. This is a hidden fee that allows the ATM operator to take a cut of the transaction. This fee varies from country to country, but it is typically around 1% of the withdrawal amount. Your card issuer or payment network may also impose their own foreign transaction fees, too.

Hotels or airport kiosks

Many hotels or airport kiosks that offer currency exchange services charge steep fees for the service. They also have poor exchange rates. You can avoid these fees by exchanging currency through your bank before you travel.

Alternatively, you can use a credit card that does not have foreign transaction fees or by purchasing local currency with cash. However, you should be wary of merchants who ask you to agree to dynamic currency conversion (DCC) when making a purchase with a credit card. This is a practice that allows the merchant to set a price in local currency and convert it to your home currency using DCC pricing, which typically includes a profit margin and fee for the merchant.

Generally, you will get the best exchange rate when you buy foreign currency through your bank before you travel. This can be done online or in-person. Some banks even let you order your currency online and have it delivered to you before you leave.

Peer-to-peer payment services

Whether you’re splitting the bill after dinner with friends or paying your roommate your share of the rent, peer-to-peer payment services can save you time and hassle by eliminating the need for cash. These digital transactions allow you to send and receive funds through an app or website that connects your bank account, credit card, or debit card to another person’s.

However, you should be aware of the risks involved with using these services. For example, if you use a P2P service to make an international money transfer, you may be at risk of falling prey to scams. In 2021 alone, the Federal Trade Commission received more than 70,000 complaints from consumers who sent money to fraudsters via these apps.

Also, with many P2P services, the exchange rate you see online isn’t guaranteed to be the one you’ll get when you book a transfer. This can be a concern for people sending large amounts of money overseas.