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Credit Cards

NY
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195 posts
3 reviews
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Credit Cards

If a merchant posts the prices in US dollars and you pay with a credit card, is it safe to assume that the charge to the credit card will be done in US dollars; therefore no additional 3% fee from the credit card company since it is in US dollars and not colones.

Thank you.

Atlanta
Destination Expert
for Jaco, Bocas Town
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3,972 posts
128 reviews
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1. Re: Credit Cards

No it isn't. Some of the places do crazy back and forth exchanges to make more money. You will need to check and see what they do.

San Jose, Costa Rica
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47,147 posts
35 reviews
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2. Re: Credit Cards

Agree with mrolfes...some places will add up to rack rate or original price ...

roadadvisor

Costa Rica
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25,654 posts
25 reviews
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3. Re: Credit Cards

It really depends on the credit card you use, I think. My credit card doesn't charge anything extra for being used internationally but others do.

Not so sure I agree with mrolfes - if the total price on something from a merchant is $35 and you put it on your credit card, the amount on your credit card for this purchase is $35. Any additional charges or fees are added by your credit card, not by the merchant. If the price is in colones and you pay with your credit card, the credit card company will do the conversion (not always favorable to you) and then post the amount in dollars.

Atlanta
Destination Expert
for Jaco, Bocas Town
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3,972 posts
128 reviews
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4. Re: Credit Cards

Hattie, sometimes they give you a price in dollars, then charge your card in colones. The vendor decides what exchange rate to give you and very often it is in their favor and isn't what the going rate is for that day. Then your credit card gives you another exchange rate. I have even had them try to give me a price in dollars, but the bill was in colones, and then the charge was recalculated back into colones but not the original amount of colones. So the mark up is done 2x not just once. It isn't a ton of money that you can loose, but it all adds up and it is just wrong. I am not saying everyone does this, but many do. Also many are just following orders from their boss and don't really understand what they are doing.

I have an extensive background in finance, credit cards and banking so some of this stuff I can catch easier then others. It is a subtle thing they do and often you don't find out until after you get home. What I do like from the bigger grocery stores, they give you a price in colones and dollars on the receipt. So you can see exactly what your credit card should be charged when you get home.

Edited: 23 April 2010, 06:10
Grecia, Costa Rica
Destination Expert
for Province of Alajuela
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8,059 posts
43 reviews
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5. Re: Credit Cards

I think you are both right Mrolfes and Hattie. I have heard of a 3% fee some credit cards charge when used outside the USA and fits under the heading of hidden charges. All depends on the card.

Best thing, know your card.

Atlanta
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for Jaco, Bocas Town
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3,972 posts
128 reviews
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6. Re: Credit Cards

I guess I am not making myself clear. This has nothing to do witht the charges from the credit card companies. Every credit card company has their own policies, so the question about what exchange rate your cc company does or what exchange rate fees they charge can only be answered by your credit card company. What the credit card companies charge are consistent and spelled out pretty clearly.

What I am trying to say is the the MERCHANTS are the ones that will play around with exchange rates to jack the prices up. They are not consistent and are not disclosed. Not all of the merchants practice this, but some do. It isn't difficult to figure out when they are doing it if you can handle basic math. If you have had a few cervezas then a calculator helps ;)

Costa Rica
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25,654 posts
25 reviews
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7. Re: Credit Cards

mrolfes - after 8 years of living in CR, I have never experienced what you are talking about. And, yes, I check my receipts, etc. I guess I have just been lucky. This is a lot of finagling for someone to do, especially if it is just a young lady who is working the caja. (Most stores, pharmacies, etc will have a separate function for the clerk and the person taking the money which is known as "the caja.") I have never had my card charged in colones if the price is in dollars - and yes, I check my transactions pretty closely. If the charge is in colones, there will always be some kind of entry that says something like "exchange fee" or whatever.

I do think that merchants rarely use the "official" exchange rate - I have even had them ask me what it is - and prefer to just use 500 or 550, depending. It sometimes changes so rapidly that by the time they get their money to the bank, they have lost. As you said, it is not much.

However, I mostly pay in colones for things that are priced in colones so really not an everyday issue.

Pensacola, Florida
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12,945 posts
55 reviews
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8. Re: Credit Cards

Most credit cards charge a 3% foreign exchange fee

Colones or dollars...

www.capitalone.com is the only us major that does not

Paris, France
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569 posts
30 reviews
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9. Re: Credit Cards

Most likely you will get hit with the 3% charge because as has been pointed out, those U.S. dollar prices are often converted to colones. And even on the occasion where there is no conversion to colones you may get hit with a conversion charge. For instance, recently my U.S. HSBC bank charged me the 3% on withdrawl of U.S. dollars from an HSBC ATM in Costa Rica. Two years ago they did not do this. What they told me is that now, even though the withdrawl is in U.S. dollars, they treat it as a colon withdrawl and tack on a 3% charge. I am sure that other banks, looking for new sources of revenue since they cannot issue subprime loans anymore, are using adopting similar strategies to balance their books. I believe there are some credit cards, maybe Chase, the only charge a 1% exchange fee (this could have changed), so opening an account with them might be the best way to minimize these transaction fees.

Ontario
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226 posts
6 reviews
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10. Re: Credit Cards

when we used our credit card there was a 2.5% extra charge but they do tell you that before hand, at least when we were charged that they told us. I'm not sure the reason but we were aware.

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