Jul 5, 2018

The DBS Multi-Currency Account is a Foreign Currency Wallet which charges NO foreign exchange fees!


When it comes to spending overseas, there are only a few options to spend in foreign currency – going to the moneychanger and carrying thick wads of cash, swipins credit cards or withdrawing cash from the country's ATM.

There is one problem – all of the above involve some form of transaction charge such as additional FX fees (on top of credit card spread and ATM withdrawal fees).

Moneychangers probably offer the lowest spread of the lot; about 1% to 1.5% spread if you make the effort to visit and queue at a good moneychanger offering a competitive exchange rate. But therein lies a conundrum – is it safe to carry so much cash in a foreign country?

Credit cards, on the other hand, offer the convenience of paying without the need for cold hard cash. But do you know that when you pay with your credit card overseas, you are hit by three different kinds of fees?

1. Platform fee charged by Visa/Mastercard/AMEX
2. Banks foreign currency transaction fee
3. FX conversion fees

Think you can avoid it by paying in SGD? Think again – by paying in SGD via Dynamic Currency Conversion (DCC), you will incur even higher charges of 7% to 15%.

And withdrawing from an ATM? Expect to incur a flat fee that banks charge for ATM withdrawals on top of the currency conversion fee. Not to mention there is risk of card skimming at overseas ATMs too.

Which is why I decided to open a DBS Multi-Currency Account (MCA) before our trip to Europe in December last year.

Ok, before I continue, let me just put on record that I signed up for a MCA last November on my own accord but DBS only approached me for a collaboration in April this year. So yes, I had a first-hand experience in utilising the MCA for our Europe trip and how utterly convenient it was!

So what is the MCA? As its name suggests, it is an account that offers you the possibility of zero foreign currency transaction fees while enjoying the convenience of buying forex on-the-go. It currently supports 12 different foreign currencies: Australia Dollar, Canadian Dollar, Chinese Yuan (*not available for debit card payment) Euro, Hong Kong Dollar, Japanese Yen, New Zealand Dollar, Norwegian Kroner, Sterling Pound, Swedish Kroner, Thai Baht and US Dollar.

How it works is pretty straightforward: Once you had opened the account, you can choose the currency you would like to exchange and perform a funds transfer to lock in the rate in the MCA. You can also set and receive FX rate alerts on digibank. Once your preferred rate is met, simply log in to digibank and transfer your desired amount from your SGD funds into the MCA. Super simple and convenient!

It is like having 12 baskets of foreign currencies in your pocket. If you are travelling to Europe and Japan, you can choose to 'top up' your Euro and Yen baskets by converting funds from your DBS/POSB account into the relevant currency at a FX rate that you feel comfortable with. No more running to the moneychanger on the eve of your holiday!

For all shopaholics – you can also enjoy these features when you shop online on international sites. Just link your existing Visa Debit Card with MCA to enjoy direct foreign currency payments in 11 foreign currencies with no additional/hidden fees.

Which was what I did during our trip to Germany in December.

For example, I only booked the Stadium tour at Bayern Munich FC when we were in Germany via its online platform using my DBS Visa Debit Card. Tickets cost €19 per adult and €11 per child, which came up to a total of €71. Paying with the DBS Visa Debit Card linked to my MCA, I saved 3% in FX fees and 7 to 15% in DCC charges which amounted to about €8, a conservative estimate. It may not seem like much but it was enough to offset a nice afternoon tea in a quaint cafe in Frankfurt.

But the MCA does not only come in handy during travelling. The DBS Visa Debit Card can also be used for online shopping transactions... which (unfortunately) the wifey is a huge fan of. But I digress. The main point of online shopping, especially if you make your purchases from overseas sites, is to enjoy the attractive discounts and sales offered. But more frequently than not, the savings will be whittled down, no thanks to the high conversion fees incurred from our credit cards.

My solution? I use the DBS Visa Debit Card that’s linked to my MCA when I am doing my online shopping from overseas sites. Like from Better World Books, a UK-based store that sells both first & second-hand books.

The site transacts in USD so all I have to do transfer some of my funds to my MCA USD basket and I am able to pay for the books in USD! A spending of US$100 saves me about S$4 - it does not seem a lot on its own but add that to the numerous shopping transactions over the course of one year AND the savings on our overseas trip and I think it will be pretty substantial!

Personally, I love the convenience of having the MCA with these 4 main benefits:

Buy and save currencies at your preferred rate, 24/7
I am able to enjoy full control and access to 12 foreign currencies and the Singapore Dollar online, anytime and anywhere. When the rates are favourable to me, I can buy it, lock it, and *save it for later spending on my DBS Visa Debit Card.

No conversion fees or extra charges
No more time wasted queuing at money changers, or searching for the best exchange rates. When I buy a US$100 item, US$100 is debited from my USD account. Even for refunds for an US$100 online purchase, the US$100 is credited to my USD account – no extra conversion fees incurred!

Receive alerts on the rates I want
I can set my ideal currency and preferred rate on digibank and DBS will send me a notification as soon as it becomes available. This allows me to apply a Dollar Cost Averaging approach when it comes to converting SGD to a foreign currency for my upcoming overseas trip. For example, I wish to change S$1,000 worth of Euro so what I can do is to choose to transfer $200 every month from my SGD account to the MCA Euro basket over 5 months.

Avoid bulky cash when you travel
My DBS Visa Debit Card makes it a safer and more convenient way to pay for items or withdraw cash when I am abroad. No need for me to carry around large quantities of cash. Ever.

Better yet, you now get to enjoy 5% cashback when you spend in foreign currencies either shopping overseas or online with DBS MCA and DBS Visa Debit Card from 5 June to 31 Aug 2018!

Signing up for a MCA is a breeze too. Existing DBS and POSB customers can do it instantly online. Log into your DBS iBanking and select Apply; Deposit Accounts; DBS eMulti-Currency Autosave Account. You can also apply for the DBS Visa Debit Card if you don’t already have it. Link it to your MCA so that any transactions will be debited from it. New DBS customers can also apply online as well.

For me, my DBS Visa Debit Card that’s linked with my MCA is the first card that goes into my wallet every time we head overseas and I do not have to make a mad dash to the moneychanger too. With just a few taps on my phone, I have all the funds that I need for my overseas spending at the best possible rates. It is like having a virtual foreign currency wallet and this one is for keeps.

  • *Terms & Conditions apply. SGD deposits are insured up to S$75,000 by SDIC.

For more information, visit HERE.

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1 comment :

Stanley said...

But there is a $2 a month account fee, which adds up to $24 per annum? So need to spend US$600 per annum to break-even?

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