Top of main content

Should you pay in local currency outside the UK?

In most cases it will cost you more to make a card payment outside the UK in pounds sterling rather than the local currency.

Whether you’re buying a meal in a Spanish tapas bar or paying for a bus tour in the US, you may be given the choice.

It might be tempting to settle for the amount you’re offered in sterling (GBP), as it's the currency you know best. 

Here's a guide to help you weigh up the pros and cons of paying in euros or pounds when spending money outside the UK. 

What is dynamic currency conversion?

This happens if you choose to pay in your home currency rather than the local currency. It means the conversion takes place at the point of sale.

Dynamic currency conversion is sometimes known as DCC.

Paying in sterling

If you opt to pay in your home currency , you’ll know more accurately how much things are costing as you pay.

However, it can be more expensive as a shop or restaurant is allowed to set its own exchange rate to convert the amount you’re spending. They may also add extra conversion fees on top of this.

Some retailers are given an incentive to use DCC to earn more. This may be through a favourable exchange rate or extra conversion fees.

Explore: How do exchange rates work?

Paying in local currency

Research shows that in most cases you can save by opting to spend in the local currency. For example, that would mean choosing euros in Spain or dollars in the US.

When you choose to pay in the currency of the region or country you’re visiting, Visa or Mastercard will set the exchange rate. Your bank may also charge a fee to carry out the transaction.

The rate used by your card provider when paying in local currency will in most cases be lower than that of the merchant, or foreign bank, when paying in sterling.

Some retailers outside the UK might automatically assume you want to pay in pounds unless you say otherwise, so always double check the amount before paying.

Explore: Card fees and charges outside the UK

Using HSBC Global Money

If you have an HSBC Global Money Account, you can order a debit card to use with it. There are no HSBC fees for using the card to make payments outside the UK. Other non-HSBC fees may apply. 

Global Money is only available in the latest version of the HSBC UK Mobile Banking app. You’ll need to have an eligible HSBC current account. This excludes our Basic Bank Account, Amanah, Appointee and MyAccount.