DCC(Dynamic currency conversion) was created around 1996 to help manage chargeback disputes.
People would dispute a charge because they did not agree with or understand the value.
Eg. Someone would make a $2 payment with their card and when it appears in their bank statement, they would see NGN900(450 exchange rate) whereas they expected to see NGN800(400 exchange rate).
Usually this would become a dispute and create a chargeback. So DCC was designed to INFORM the user properlyand charge them the informed local amount which would appear in the bank statement.
Technically, this was perfect for disputes and charge back prevention.
So why is it bad in Nigeria and why are Nigerian banks threatening to kill people because of DCC?
Sometimes I feel very disappointed with the emails I receive from our Banks.
Are the guys in the bank aware that DCC is configured at the switch level and the normal guy on the web does not even have any knowledge of what it means? When a bank send s a mail asking card users not to select DCC payment option, what is DCC and is there any website where there is a DCC option highlighted enough for the user to even understand what it means.
As a business guy, I don’t like to criticise other businesses but I believe engaging Monex, Elavon, Fexco and Euronet via the banking committee will provide a more sustainable long term solution.
For small businesses using their Naira cards on international payment gateways for their servers or services, feel free to learn from this Paypal implementation and search for similar options in your operating websites or maybe you can email the service provider about DCC when your card gets rejected.
Paypal has an option https://www.paypal.com/us/cgi-bin/webscr?cmd=_profile-merchant-pull-funding
Here is where you set the DCC option like below;
Unfortunately, only the user can set this.
If you are accepting Paypal on your portal, this may be the reason for rejection of Nigerian cards.
Also, the guys competing with me in this race to build the best payment service in the world should note this and make provisions for Australia, Hong Kong and Swizz clients.
I hope this sharing will be useful for a couple of people in the house.