Paying in euros in Prague costs more than paying in koruna

You withdraw three thousand koruna from a cash machine in Prague and the screen offers to charge you in euros, in your usual currency. Accepting that offer costs you between 3 % and 12 % more.

It is called dynamic currency conversion and it works like this: if you say yes to euros, the exchange rate is set by the company running that machine or that card terminal, and it keeps the difference. It never shows up as a fee on any line of your statement, because it is already cooked into the amount.

If you choose koruna, the conversion is done by your card network — Visa or Mastercard — at the day's rate, and on top of that your bank will charge its own share, between 0 % and 3 % depending on your contract. That one does appear on the statement, with a name and a figure.

Since 19 April 2020 a European rule has obliged them to show you, before you accept, how far that offer departs from the official European Central Bank rate. It is on the same screen, written as a percentage, almost always in small print.

On three thousand koruna, about a hundred and twenty euros, choosing wrong costs between four and fifteen euros.