The Currency Exchange Trick at European Airports That’s Costing You Hundreds

I landed at Charles de Gaulle on my first solo Europe trip, jet-lagged and running on airport coffee, when a cashier at the ATM asked me a question I didn’t fully understand: “Would you like to pay in US dollars?” I said yes. It seemed easier. It wasn’t until I checked my bank statement a week later that I realized that one little “yes” had cost me an extra $47 on a single transaction.

That experience taught me about one of the most common and quietly expensive traps for American travelers in Europe. It’s called dynamic currency conversion (DCC), and if you don’t know what it is before you land, you could easily lose $100 to $300 on a single trip without even realizing it. In this post, I’m breaking down exactly how it works, why it catches so many Americans off guard, and the practical steps I now take every time I travel through European airports to keep my money where it belongs in my wallet.

What Is the Currency Exchange Trick at European Airports?

The “trick” is called Dynamic Currency Conversion, or DCC. It sounds like a service, and that’s exactly the problem. When you use your card at an ATM, hotel, restaurant, or shop in Europe, the terminal will often offer to convert your transaction into US dollars right then and there. It frames this as a convenience you get to see the price in a currency you recognize.

But here’s what they don’t tell you: that conversion comes with a markup. The exchange rate used by the merchant’s bank is almost always worse than the rate your own bank would apply, and on top of that, your bank may still charge its usual foreign transaction fee anyway. You end up paying twice.

The European Consumer Organisation has called DCC “fundamentally a scam,” noting that consumers are almost always paying more just to see the price in their home currency. Visa itself warns travelers about this practice and confirms you have the right to decline it every time.

How Dynamic Currency Conversion Actually Works

Here’s the simple version: when you use your card abroad, two things can happen.

Option A (the right choice): You pay in the local currency euros, pounds, kronor, etc. Your card’s bank does the conversion back to dollars using a competitive market rate, and you may pay a small foreign transaction fee if your card has one.

Option B (the expensive one): You accept DCC. The merchant’s payment processor converts the amount into dollars at their own rate, which typically includes a markup of 3% to 8% above the real exchange rate. Your bank may still charge its standard fees on top of that.

Most travelers pick Option B simply because the screen defaults to it, or because the wording is confusing. Some ATMs will say things like “lock in your rate today” or “pay in the currency you know.” These sound reassuring. They’re not. The answer should always be the local currency.

Why European Airports Are Especially Risky

Airport currency exchange booths are a whole separate issue. The standalone exchange kiosks you see right after landing Travelex and similar operators are known for offering some of the worst rates you’ll find anywhere. They rely on the fact that you’ve just arrived, you might need cash urgently, and you haven’t had a chance to find a proper ATM yet.

What makes European airports particularly tricky is that some of them have reduced the number of bank-owned ATMs and replaced them with operator-run machines that are DCC-enabled by default. If you walk up to an ATM that prominently offers dollars, you’re likely at one of these machines. Bank-branded ATMs, where available, tend to offer better rates and clearer terms.

The pressure of arriving somewhere new, juggling luggage, and needing cash quickly is exactly the environment where these setups thrive. I’ve watched travelers at baggage claim say yes to DCC three times in a row without registering what they were agreeing to.

How Much It Really Costs The Numbers

Let me put some real figures to this. Say you withdraw €500 from an airport ATM during your Europe trip. Here’s roughly what happens with each choice:

Paying in local currency (euros):

• Exchange rate: close to the mid-market rate, e.g., 1 EUR = 1.08 USD
• You pay: ~$540 plus your bank’s ATM fee (typically $3–$5)

Accepting DCC (paying in dollars):

• DCC provider adds a markup of 5–8%
• You pay: ~$567–$583 for the same €500
• Your bank may still add its ATM fee on top

That’s a difference of $27 to $43 on a single ATM withdrawal. For a two-week trip where you make several withdrawals and card payments, DCC could easily add $150 to $300 to your total costs without you ordering anything extra or making any obvious mistake.

How I Avoid This Every Time I Travel to Europe

After that Charles de Gaulle moment, I built a few simple habits that I now follow every trip.

Always choose the local currency. Every single time a terminal asks me whether I want to pay in dollars or the local currency, I choose the local currency without hesitation. It doesn’t matter if the screen shows the dollar amount alongside it I still choose local. If the ATM offers to “guarantee” my rate or “protect” me from fluctuations, I press no.

I use a bank ATM, not a standalone operator. When I need cash at the airport, I look for a bank-branded ATM look for names like Deutsche Bank, BNP Paribas, Santander, or ING. These tend to offer fairer rates and are clearer about what they’re charging. I skip the flashy orange and yellow kiosks near the arrivals exit.

I get cash before I need it urgently. Landing with no local currency and a long taxi queue ahead of you is how you end up making rushed decisions at a bad ATM. I now either bring a small amount from home (exchanged at my local bank, which typically offers better rates than airport booths) or I withdraw cash from a bank ATM in the city rather than at the airport.

I check my card’s settings before I leave. Some banks let you set a preference to always decline DCC. It’s worth calling your bank before a big trip and asking about this.

The Best Cards to Use in Europe

The card you bring matters almost as much as the decisions you make at the ATM. Here’s what I’ve learned works well:

No-foreign-transaction-fee credit cards are your best friend in Europe. Cards like the Chase Sapphire Preferred, Capital One Venture, or any travel card that explicitly waives foreign transaction fees mean that when you pay in local currency, your conversion happens at the card network’s rate usually very close to the mid-market rate with no extra charge from your issuer.

Checking accounts with ATM fee rebates are useful for cash withdrawals. Charles Schwab’s debit card, for example, rebates ATM fees worldwide and uses the mid-market rate. It’s what I bring specifically for European trips.

Avoid American Express in many parts of Europe. It’s not as widely accepted as Visa or Mastercard, which can leave you in awkward situations at smaller restaurants, markets, and transit stations.

Whatever card you bring, make sure it’s chip-and-PIN capable, not just chip-and-signature. Many European automated terminals (train ticket machines, parking kiosks) require a PIN.

What to Do If You Already Got Charged

If you realize mid-trip or after getting home that you accepted DCC on a transaction, you do have some options.

For card transactions where DCC was applied without your clear consent, you can dispute the charge with your bank or credit card issuer. Under Visa and Mastercard rules, merchants are required to offer you a choice not just assume you want DCC. If you were never given that choice, or if it wasn’t clearly disclosed, that’s grounds for a dispute.

Keep your receipts. If a receipt shows two currency amounts and you signed without clearly choosing DCC, document that. A short written note to your card issuer explaining what happened is often enough to get the difference refunded.

Going forward, if you ever sign a receipt and notice after the fact that it shows a dollar total instead of euros (or whatever the local currency is), you can ask to have the transaction reprocessed in the local currency before you leave the counter. Many merchants will do this they just count on most people not knowing they can ask.

Conclusion

The currency exchange trick at European airports isn’t some sophisticated financial scheme. It’s a simple switch in how your payment gets processed, and it works because most travelers either don’t know about it or feel too rushed to deal with it. Once you know to say “local currency” at every terminal and to avoid standalone airport exchange kiosks, you’re already ahead of most tourists.

The money you save is real. On my last two-week trip to Italy and Portugal, I estimate I kept an extra $200 by being consistent about this. That’s a nice dinner, a day trip, or a flight upgrade fund just from one simple habit.

If you’re planning a Europe trip and want more practical advice on budgeting, travel cards, and what I’ve learned from years of going back and forth across the Atlantic, explore more travel tips on travelwithzee.com.