Uber claims that it wants to help its customers… by charging them an extra 1.5% fee on most foreign rides. Fortunately, you can easily opt-out of this, as flagged by View from the Wing.
Continue reading: Avoid Uber’s New Default 1.5% Preferred Currency Pricing Scam
Share your questions, experiences, and thoughts below.
Being an EU resident who frequently travels to the US, I thought a 1.5% mark up wasn’t too bad. Probably cheaper than the what my credit card charges. Though what I’m skeptical about is the exchange rate they will use. I can’t imagine it’ll be spot rate.
Moreover, I doubt Uber will convert currencies at "spot." I'll guess there will be a "spread." It's like certain hotels that mandate pricing in one's home currency and apply a spread not dissimilar to what is seen at airport currency exchange kiosks. I avoid Uber and use a local taxi app if possible.
Any time a company says they're making things "simpler," somehow it's never to your advantage.
Thank you. I just changed my settings. DCC is rarely for the benefit of consumers as there is a spread shared between merchants and acquiring banks. I never, and cardholders should never choose the DCC option.
You can save even more money with local ride sharing apps wherever they exist.
When I go into my wallet, there is no option to "set preferred currency" (no mention of it at all anywhere, and I've updated my iOS app and tried via the desktop website).
Am I doing something obviously wrong? Or is this just an option for users in the US? (I'm in the UK).
I am in the US.
In the UBER app you first have to go to Account (in iOS its on the bottom right of the iPhone screen) and then click on Wallet.
When you are out of the country always use local currency option, there are several no foreign transaction fee credits that gives you better rate. CSR is my preferred credit card when i am overseas.
When fares are set algorithmically I don't see how makes any different
The fare is the max Uber thinks you are willing to pay
The payment to the driver is the lowest Uber thinks they will accept
Fees etc just become irrelevant
I am also in the USA and see the option and have made the change
I went to Account
Wallet
Payment Methods
Right under Add Payment Method is the option for Preferred Currency
It’s code for saying we’re cutting costs and charging you more. Because, apparently, that’s what every customer in the world really wants.
Thanks @Justin Dev - strangely there is no option for Preferred Currency under Add Payment Method in my wallet. The next option for me is Trip Profiles...
I wish there was a way to make no conversion the default, so I don't have to repeatedly tell the cashier to charge my card in local currency.
Same for me; worked just as Ben described. My phone is an Android, not iPhone. Maybe that's the difference?
BTW, I recently used Uber several times in Egypt and was charged (as desired) in Egyptian pounds. Rides were ridiculously cheap, even after I added substantial tips.
Exactly - the 1.5% is conversion fee, not total cost.
Think of all those Bureau de Changes offering "No commission" but 20% spread.
@Ben - I think you ought to add this to warn people that the actual cost will be much more.
If any reader did get caught out and can report how much, that would be useful.
Just more of the tech-grift that's taken over the US. Why offer a good product when you can just rely on VC money and legal technicalities to gain market share, kill the competition, then enjoy the monopoly?
They pay the driver in local currency.
Convert to your home currency at something like 7% profit for themselves.
Then add this additional 1.5% for themselves.
Thanks, Ben. But I can't see a "Set preferred currency" option in my wallet. Anyone else have this problem?
Found an Uber webpage that says it's only available for residents of certain countries.
so with this one, can you use the amex credit while using uber abroad? If so, i don't mind paying the 1.5% fee because I never use uber in the US
I agree that everyone should avoid the 1.5% conversion fee from Uber by utilizing the cc that doesn't have the foreign transaction fee! I thought it was bit shady for them to make the conversion fee a default setting!
@Rico: I am using an android phone, located in the USA and found it quite easily. It's in Account> Wallet right under Add Payment Method.
Perhaps you may need to update your app to the latest version.
Interesting. In my app, preferred currency is just above Trip/Ride Profiles. Perhaps you could see if there is an update of the app?
Funny quasi-bug: As a US-based person who frequently travels to the UK, it actually tried to default to GBP for me. My guess is that this is because I use Lyft almost exclusively in the US, but when I am in the UK I use Uber, and I probably have spent more money on Ubers in the UK than in the US. I am guessing there is some logic based around this.
If your Amex credit is in US$ you can only use it in countries that use US$. Which is more than just the USA! (Panama, and others).
Likewise, a credit in any other currency can only be used in a country that uses that currency.
It's actually a good move for Canadians. There is only ONE major credit card in Canada without fx fees, all others are 2.5%. Having an option to reduce it to 1.5% is a good option to have.
The part that amuses me is that they exclude what is the only business case I can think of which is if traveling internationally for business is to know if your ride is within some expense policy limit
DCC is an internal Uber mechanism, where the 1.5% is charged by Uber yet the back-end transaction is done in original currency vis-a-vis the issuer.
It is common practice across many industries, and it does not eliminate your card issuer's FX fee. Whether you have a 2.5% FTF or no FX fee, this 1.5% will always come on top. In the case you referred to, the total charges would therefore amount to 4%.
How's Uber doing this? Through the credit cards? Normally, Amex doesn't allow dynamic currency conversion, while Visa and MasterCard do.
This is becoming more and more frequent. Paypal does something similar unless you opt out as well.
I'm also finding in northern Mexico many of the POS terminals now have a dollar option. Unfortunately many of the retailers' clerks are unaware and will simply keep hitting the green OK button which results in a dollar conversion. For pesos they would have to hit the red cancel button. The POS actually has a message to pass the terminal to the user but often they do not see this since rarely receive foreign cards. The message that follows is often only in English, I now have a default letter I send to my credit card company to dispute the conversion fee.
@Larry - no, in Canada, 2.5% is not a foreign transaction fee, it's a foreign currency fee, which is only charged on non-Canadian dollar transactions. If Uber charges a Canadian card in Canadian dollars, the bank will not charge the extra 2.5% fee. Currency is key here, not a point of sale. I understand it's different in the US.
The FTF is the 2.5% charged in Canada for all non CAD transactions. Uber's 1.5% is a simple DCC, and hence falls into the non-CAD definition.
Would urge you to look closely into this matter, this is an extract from Uber's terms:
"Your credit card issuer or bank may impose additional fees, which may increase the overall cost of your purchase. The Conversion Fee assessed by Uber will apply even if your credit card does not charge a foreign transaction fee".
This is no surprise. This is similar to credit card companies that allow you to choose USD when abroad or local currency. The credit card will most often give a better rate if choosing local currency. There are many credit cards with no foreign transaction fees nowadays. If there is enough complaint Uber may change it.
Is this just a USA thing? I've accessed 'Wallet' via 'My Account' and have no preferred currency option. And, yes, my Android version is the latest.
Odds are fairly high you'll end up paying both, I'd check it out if I was you....