My home currency is ÂŁ. I have used the T212 card abroad frequently and immediately compare the exchange rate with revolut and wise. It does not compare that favorably.
Question: I wonder if I can get a better rate abroad if I first convert the £ in cash to the local currency (go to “cash” and press “convert”) and then use the card after converting manually? My thinking is if I don’t have local currency, so the card has to convert the currency, the card will be using mastercard’s own rates rather than T212’s preferable rates. So to avoid high exchange rate fees, in the T212 app, in the cash section I should press “convert” so I exchange manually first so I’m holding the local currency and then use the card so it debits automatically from there.
What is difference in percent compared with alternatives?
You’ll be getting fleeced by the card operators. Make sure you pay in local currency, if they do the conversion on the terminal, you’ll get rogered.
Yes this is what I thought. I went through all the T212card help articles re: using the card in a currency where you have zero cash balance, and none of the help articles mention that it is better to convert manually yourself first as it’s a much lower rate. I would like T212 to give advice on this aspect please as it would be nice to have an official response.
No you’re misunderstanding. On the terminal you pay on with the card at the merchant there’s an option to pay local currency or let the merchant do the conversion. If you pick the wrong option you’ll get a crap rate.
if I pay in a store with my virtual T212 card, there is no option to pay in local or let the merchant do the conversion. I just use my iphone wallet (apple pay) to pay. or else if I use the virtual card online I pay via that. again no option to pay in local or let the merchant do the conversion.
Sounds like it’s happening automatically then - that’s why you’re getting a bad rate.
If this is the case, it would be helpful if T212 amended their help articles on this to advise to exchange manually first - go to cash and press convert etc. I am sure I’m not the only one who doesn’t know this. I am still waiting for T212’s official response.
I just checked, and don’t see a difference between the standard 0.15% FX fee and “auto-conversion” upon card transaction (I’m holding only EUR in my account, had card expenses in SEK):
- market-close rate before weekend: 11.3109 (google finance)
- theoretical mastercard reference rate for Feb 8: 11.28049
- actual weekend transaction conversion rate logged with “auto-conversion” on Trading212 card transaction: 11.29452 → 0.15% markup over market, better than MC
No, before you tap using your phone (i.e. with your virtual T212 card) the display must show the currency (and the amount) that is being charged. If the retailer is trying to charge you in GBP then you should refuse the transaction and tell them to put it back into the local currency (with the amended amount shown).
T212 will then accept the amount and undertake the conversion to GBP themselves.
I think i’m confusing people so I’ll try to give more details. I live in the UK, my T212 cash/card is in £. I have zero euros in my account. I fly to France and go to a supermarket. At the supermarket checkout the til says I have to pay for example 20 euros. It does not mention £. I tap my phone on the card reader and it automatically deducts 20 euros from the T212 virtual card (apple pay). I then click into the T212 card app and it tells me the conversion rate from euros to £ and how many £ it deducted from my £ cash. The rate isn’t good unfortunately. Question: I wonder if I can get a better exchange rate if I first convert the £ in cash to the local currency (go to “cash” and press “convert”) and then use the card after converting manually? My thinking is if I don’t have local currency, so the card has to convert the currency, the card will be using mastercard’s own rates rather than T212’s preferable rates.
I think the T212 card will do exactly what you want.
If you look at Can I use the card if I travel abroad? – Trading 212 it says that it used “The local currency, if you have enough balance.” The example below that mentions that the funds will be taken from the local funds wallet and implies that it there is not enough funds in that then it will be taken from your home currency wallet (with the then current FX fee and exchange rate).
So if you wish to lock-in the currency rate simply convert enough funds before you purchase.
I just received a partial reply from T212’s email help:-
"When converting funds from one currency to another via the Trading 212 app, you will always get the live interbank rate.
If the interbank rate isn’t unavailable, Mastercard’s exchange rate will be applied to the conversion without additional spreads or markup. - Mastercard® Currency Converter Calculator
While we understand how important it is to avoid being charged with higher rates, these are the two only options, and an alternative is not available currently."
We have gone through the post in detail, and we can confirm that we use interbank rates in both cases. In short, the only difference is that when you convert funds manually before making a payment, the 0.15% FX fee will apply, while if you don’t have enough funds in the currency of your payment, the conversion will happen automatically at the same rate without an FX fee.
As @jbms also sent us a private message about this, I’ll close this topic for now, and we’ll make sure to address all of his questions in further detail, as well as anything else that may pop up on the way 