Quote:
Originally Posted by HeatguyAlvin
Ah, i noticed I've framed that wrongly. I'm definitely not complaining about 200 rupiah variance but how in a matter of a day or two the XE rate rose to 11,000++. Its no wonder why hotels don't collect deposits in their local currency any longer, noticed that on my XE card throughout my three nights i had a 1% to 2% markup on several days. Thought it was weird but it could be just currency fluctuations.
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Noted your explanations with thanks.
I think it is worth to provide some explanations on how MasterCard/VISA cards work. I assume also other international circuits work in the same way, even with some slight variations, because the business is the same.
When you purchase a good with a credit card out of your country (in local currency!! ALWAYS opt for the local currency!!), or you withdraw money abroad in local currency, you will be charged using the
current interbank buying rate at the time the transaction is finalized, the one we see on XE.COM (there are two exchange rates at any time: one for buying, one for selling a currency) PLUS a +2% fee (that goes to MasterCard/VISA).
When you do several withdrawals in a day, it is possible, but not likely, that the exchange rates are different.
When you use a credit card to withdraw money from ATM, that is cash advance. They lend you money. Then, on top of that +2%, you also pay +4%. ==> ALWAYS USE DEBIT CARDS to withdraw money from ATMs.
On top of that, for debit or credit cards, it is possible that the local bank and your bank also apply their fees (my bank charges ~3 SGD flat fee on each withdrawal I do abroad).
Said all this, the cheapest way to convert our home currency to a local currency is most of the times one of the following two:
1) Use a debit card on an ATM (at best, we pay %2 + some 2 SGD flat fee). This is also the easiest and less time consuming. I do this.
2) Search an exchange office that applies best conversion rates. This takes time, but it may be profitable, because some offices apply a fee that is less than 2%, for example if you give new 100 USD notes, that have a special market in Indonesia (I think they are good for unofficial business transactions). I do this when I have some USD cash, which I want to spend in Batam
Quote:
Originally Posted by Ninja_Assassin
I have a BNI bank account in Singapore..... I can use their bankcard to make withdrawals in Batam bypassing the need for moneychangers. No overseas service charge and exchange rate on par with the market rates. Very convenient.
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I do the same with my bank card, but do not be too optimistic.
As I have explained above, you will pay a +2% fee applied on the XE rate, not because BNI bank is bad, but because that is how international circuits change currency. Even if your card is does not pass via VISA or MAsterCard (do you see their logos on your BNI card?), then you have to pay some 2% (ok, 1.5%?) to the international circuit that makes the conversion.
What I write is not valid, only if your BNI bank account in Singapore is denominated in IDR, which I doubt.