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Lithuanians will benefit from the changes when traveling and paying with a card in the European Union in non-euro area countries. Probably not many people have wondered what currency to pay when the seller offers to choose the local currency or the euro. Now the information will be presented in such a way that consumers can clearly compare the applicable tariffs and choose a cheaper option, “says Tomas Karpavičius, Head of the Market Infrastructure Policy Division of the Bank of Lithuania.
For settlements that are not in euros, the amount in the currency of another country becomes an amount in euros, that is. and. in the currency of the payer’s account. The exchange services can be offered by the bank or merchant of the payer. Both must provide information on the exchange costs incurred by the payer in the same way as an exchange surcharge, expressed as a percentage of the exchange rate published by the European Central Bank (ECB).
At the same time, at the point of sale (including the ATM), the payer must be provided with the amount to pay in local currency and the amount in euros, for example, 100 PLN is equal to 24 EUR, in which case the surcharge for currency exchange it is 2.3%.
The payer’s bank must report the currency exchange surcharge applicable in the contract, publish it on the website, in the price list, in the online banking system. Such information will help the payer to compare the offered currency exchange price and to choose a more favorable option when the merchant or ATM service provider offers the currency exchange, respectively, when paying with a payment card or withdrawing cash from an ATM. Also, the buyer always has the right to choose to pay in local currency, the seller cannot unilaterally change the currency.
Exchange rate transparency requirements also apply to online or in-app payments other than euros. Upon initiating a payment, the payment service provider will inform the payer of all direct and indirect currency exchange charges applicable to the transfer of funds.
According to T. Karpavičius, for this requirement to be properly implemented, payment service providers must display exchange service fees as fees derived from the applicable exchange rate, which exceeds the last basic exchange rate published by the ECB.
The payer must also be informed of the total amount of the transfer, including all charges in euros, and the amount to be transferred to the beneficiary in his currency. This way of presenting the information will allow the payer to see and, if necessary, compare all the exchange costs associated with the payment.
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