USD or PHP for credit card purchases

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Posted

Math has never been my strong point so please bear with me. 

We recently took a day trip to Siquijor. We were so impressed with the resort where we had lunch that we decided to spend the night. Because it wasn't planned for I was short on cash. When we checked out I handed the clerk my US Visa credit card and was asked if I wanted to be billed in pesos or dollars. Being the first time I ever charged anything in the Philippines I was caught off guard and didn't know what was best so I just said dollars. Did I choose the right currency? Is it better to be billed in the local currency or your home currency where you bank? As I research online I am more confused. Can anyone shed some light on how best to handle CC purchases? 

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Posted
3 minutes ago, Jeff R Us said:

Math has never been my strong point so please bear with me. 

We recently took a day trip to Siquijor. We were so impressed with the resort where we had lunch that we decided to spend the night. Because it wasn't planned for I was short on cash. When we checked out I handed the clerk my US Visa credit card and was asked if I wanted to be billed in pesos or dollars. Being the first time I ever charged anything in the Philippines I was caught off guard and didn't know what was best so I just said dollars. Did I choose the right currency? Is it better to be billed in the local currency or your home currency where you bank? As I research online I am more confused. Can anyone shed some light on how best to handle CC purchases? 

It depends on a few factors, but I think choosing peso is usually best.  I know it is for my card.

First, you need to know what kind of exchange rate your credit card gives.  Some cards like my CapitalOne card give a great exchange rate, very close to the mid-market rates you see on XE.com.  So if your quoted resort rate was p5000 per night, I would tell them pesos and get a great exchange rate from CapitalOne.  Some cards may have poor exchange rate, so they can make some money on international transactions.

If you choose dollars, the resort will have to exchange from pesos to dollars, using their rate.  Hopefully if they offer billing in dollars, they have the rate posted on the wall.  It will probably not be a good rate, so they will also make some money on the exchange.

So for instance, the rate right now on XE.com is 53.29.

Using my CapOne card, my billing might be something like p5000 / 53.25 = $93.90

If the hotel rate is 52.25, your billing will be p5000 / 52.25 = $95.69.

Not the end of the world and the hotel makes a few extra bucks.

 

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Posted
40 minutes ago, OnMyWay said:

It depends on a few factors, but I think choosing peso is usually best.  I know it is for my card.

First, you need to know what kind of exchange rate your credit card gives.  Some cards like my CapitalOne card give a great exchange rate, very close to the mid-market rates you see on XE.com.  So if your quoted resort rate was p5000 per night, I would tell them pesos and get a great exchange rate from CapitalOne.  Some cards may have poor exchange rate, so they can make some money on international transactions.

If you choose dollars, the resort will have to exchange from pesos to dollars, using their rate.  Hopefully if they offer billing in dollars, they have the rate posted on the wall.  It will probably not be a good rate, so they will also make some money on the exchange.

So for instance, the rate right now on XE.com is 53.29.

Using my CapOne card, my billing might be something like p5000 / 53.25 = $93.90

If the hotel rate is 52.25, your billing will be p5000 / 52.25 = $95.69.

Not the end of the world and the hotel makes a few extra bucks.

  

And don't forget that many credit cards,( Not Capital One),  charge a foreign transaction fee which can make those good exchanges not so good.

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Posted
1 hour ago, Jeff R Us said:

Math has never been my strong point so please bear with me. 

We recently took a day trip to Siquijor. We were so impressed with the resort where we had lunch that we decided to spend the night. Because it wasn't planned for I was short on cash. When we checked out I handed the clerk my US Visa credit card and was asked if I wanted to be billed in pesos or dollars. Being the first time I ever charged anything in the Philippines I was caught off guard and didn't know what was best so I just said dollars. Did I choose the right currency? Is it better to be billed in the local currency or your home currency where you bank? As I research online I am more confused. Can anyone shed some light on how best to handle CC purchases? 

Many places in the PI add an additional 5% to the balance if you pay via credit card so always ask them how much additional you will be charged from them for using your card.

'Forbes and other money/travel sites recommend always charge in the local currency.

https://www.forbes.com/sites/geoffreymorrison/2014/07/30/pay-in-local-or-home-currency/#3add4d3c3307

 

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Posted
1 hour ago, Jeff R Us said:

Did I choose the right currency?

That is a very good question and it would be interesting to know what the bill would have been if you had cash - pesos and what the bill actually was in dollars.

Do you have that info?

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Posted
30 minutes ago, Dave Hounddriver said:

That is a very good question and it would be interesting to know what the bill would have been if you had cash - pesos and what the bill actually was in dollars.

Do you have that info?

Yes, we have the info but the wife will have to dig it up as she does all the filing. As I Googled I was lead to another forum and all the expats claimed that they choose to be billed in dollars. I also saw where some BPI officer recommended being billed in pesos if you have a Philippine card. Maybe it depends on the country your card is issued from.  :89:

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Posted
1 hour ago, Jeff R Us said:

Yes, we have the info but the wife will have to dig it up as she does all the filing.

That will help with the math.  Hope she digs it up and we can get to the bottom of it.

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Posted
8 minutes ago, Dave Hounddriver said:

Hope she digs it up and we can get to the bottom of it.

The hole ? :89: :whistling:

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Posted
3 hours ago, Jeff R Us said:

That is a very good question and it would be interesting to know what the bill would have been if you had cash - pesos and what the bill actually was in dollars.

Do you have that info?

Here it is!

IMG_20180615_180622.jpg

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Posted

I would pay the 6,500p in local currency as the $129.23 is translated at 50.30 which is somewhat less than the 52.80 rate you can get on the street. 

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