When Sarah and her husband planned their 10-day trip through Italy, they did a lot of things right. They booked flights months in advance, mapped out an itinerary through Rome, Florence, and Venice, and even brought a credit card with no foreign transaction fees.
What they didn't prepare for was a quiet fee that showed up at nearly every ATM and payment terminal along the way. By the time they got home and reviewed their bank statement, they had lost over $200 to something they had never heard of: Dynamic Currency Conversion.
The First ATM in Rome
It started at Fiumicino airport. After landing, Sarah found an ATM near the arrivals hall to withdraw euros for the taxi into the city. She inserted her debit card, entered her PIN, selected 300 euros, and then a screen appeared she hadn't seen before.
The ATM asked if she wanted to be charged in euros or US dollars. It showed the dollar amount right there on the screen: $341.22. She thought, "Great, I can see exactly what I'm paying." She hit the dollar option and took her cash.
What she didn't realize was that the real exchange rate at the time would have made that 300 euros cost about $326. The ATM had applied a 4.7% markup through its own conversion rate. That single withdrawal cost her an extra $15.
What Happened Here
The ATM was operated by Euronet, an independent ATM company that makes a significant portion of its revenue from DCC. When Sarah chose to pay in dollars, the ATM converted her withdrawal using Euronet's own exchange rate, which included a hidden markup of nearly 5%. Her bank never got the chance to do the conversion at its competitive rate.
Hotels, Restaurants, and Shops
The ATM was just the beginning. Over the next 10 days, DCC followed Sarah and her husband everywhere.
At their hotel in Rome, the front desk asked at checkout if they'd like to pay in euros or dollars. They chose dollars again, thinking it was simpler. The hotel bill of 480 euros came to $548 on their statement. At the real rate, it should have been about $523. Another $25 gone.
At a restaurant in Florence, the waiter brought a card terminal to the table. The screen briefly showed an option to pay in USD. Sarah's husband tapped the dollar option without thinking. A 95-euro dinner cost them about $5 more than it needed to.
At a leather shop in Florence, the same thing happened. The terminal defaulted to showing a USD amount, and they confirmed the payment. At a glass studio in Murano near Venice, same thing. At a cafe near the Trevi Fountain, same thing.
Each individual charge was small. Five dollars here, three dollars there. But they were using their cards four or five times a day for 10 days.
The Math Back Home
When they got home and went through their statement, they added up every transaction where they had paid in dollars instead of euros. The total was eye-opening.
| Transaction | What They Paid (DCC) | What It Should Have Cost | Lost |
|---|---|---|---|
| ATM withdrawal (airport) | $341 | $326 | $15 |
| ATM withdrawal (Florence) | $228 | $218 | $10 |
| ATM withdrawal (Venice) | $228 | $218 | $10 |
| Rome hotel (4 nights) | $548 | $523 | $25 |
| Florence hotel (3 nights) | $412 | $392 | $20 |
| Venice hotel (3 nights) | $502 | $478 | $24 |
| Restaurants (10 days) | $890 | $845 | $45 |
| Shopping & activities | $685 | $632 | $53 |
| Total | $3,834 | $3,632 | $202 |
Over $200 lost to DCC, spread across dozens of transactions. No single charge was outrageous enough to notice in the moment. It was death by a thousand small cuts.
Why DCC Is So Effective in Italy
Italy is one of the worst countries in Europe for DCC. Several factors make it especially common there.
Euronet ATMs are everywhere. Independent ATMs operated by Euronet and similar companies are placed throughout tourist areas in Rome, Florence, Venice, Milan, and Naples. These ATMs are specifically designed to push DCC with confusing screen prompts that make the dollar option look like the default. Our Italy ATM & Currency Guide maps out which ATMs to use instead.
Merchant terminals default to DCC. Many payment terminals in tourist areas are configured to show the USD conversion first. The staff may not even realize DCC is being applied, or they may be trained to recommend paying in dollars as a "convenience" to American tourists.
The language barrier helps DCC providers. When a waiter hands you a terminal in a busy restaurant and the screen flashes a dollar amount, most people don't feel comfortable asking questions or requesting a change. They just tap and go. DCC providers count on this.
Hotels process DCC at checkout. Some hotels in Italy process the entire stay in USD without asking. You only find out when you see the charge on your statement. If the receipt shows a dollar amount for a hotel in Italy, DCC was applied.
What Sarah Would Do Differently
After researching what happened, Sarah put together a list of what she'd change for her next international trip:
- Always choose the local currency. At every ATM and every payment terminal, always select EUR (or whatever the local currency is). Never accept a conversion to USD, no matter how convenient it looks. This is the single biggest thing she could have done differently.
- Avoid Euronet and other independent ATMs. She now knows to look for ATMs attached to actual Italian banks like Intesa Sanpaolo, UniCredit, or Banca Nazionale del Lavoro (BNL). These bank ATMs are less aggressive with DCC and often don't offer it at all.
- Watch the payment terminal screen. Instead of letting waiters or cashiers tap through the terminal, she plans to watch the screen herself and select the euro option before confirming.
- Check receipts immediately. If a receipt shows a USD amount at an Italian restaurant or shop, she'll ask the staff to void the transaction and reprocess it in euros.
- Bring some euros from home. Having cash for the first day or two means fewer ATM trips and fewer chances for DCC. She plans to order euros online before her next trip.
The Frustrating Part
What makes DCC especially frustrating is that Sarah had already done the hard part. She had a credit card with no foreign transaction fees. She had a debit card with good exchange rates. The tools in her wallet were designed to save her money abroad.
But none of that mattered because DCC happens before the transaction reaches your bank. When you accept DCC, the charge arrives at your bank already converted to dollars. Your bank sees a domestic transaction and processes it at face value. The no-fee benefit, the competitive exchange rate, the Visa or Mastercard network rate: none of it applies because the conversion was already done by the ATM or merchant's DCC provider.
The One Rule That Prevents All of This
Always pay in the local currency of the country you're in. Euros in Italy. Pounds in England. Yen in Japan. If any screen, terminal, or person offers to convert to dollars, decline. Every time, no exceptions. For a deeper dive, read our full guide on what DCC is and how to refuse it.
Lessons for Your Next Trip
Sarah's story is common. DCC catches experienced and first-time travelers alike because it looks helpful. A dollar amount on the screen feels like transparency. It feels like you're making an informed decision. But the "transparency" comes with a 3-7% price tag that's baked into the exchange rate.
The good news: once you know about DCC, it's easy to avoid. You just have to be consistent about choosing the local currency every single time you're asked.
For more on handling money in Italy, read our Italy ATM & Currency Guide. For help choosing the right cards to take abroad, see our travel card guide and debit card comparison. And for a complete breakdown of how DCC works and how to refuse it, check our DCC explainer.