Banks generally convert based on the foreign exchange rate on the date of deposit. Even if a UnionPay card is used, the exchange rate is not necessarily the day of purchase, but the exchange rate on the date of deposit. Therefore, it depends on the credit time of different merchants. It may be credited on the same day, or it may be delayed by 1-2 days.

If you swipe your UnionPay card directly and go through the UnionPay channel, the system will automatically convert the foreign currency into RMB at the real-time exchange rate at the time of entry and record it into the current bill. After returning to China, the cardholder can Repay the loan directly in RMB without purchasing foreign exchange.

Using Visa or MasterCard’s RMB + USD dual-currency card, when spending money in a U.S. dollar country, it will be recorded in U.S. dollars, and the cardholder will purchase foreign exchange and repay the money after returning to the country.

If the card is swiped in a non-U.S. currency area, the bank will first convert the local currency into U.S. dollars when converting different currencies, and record the account in U.S. dollars. When the repayment is due, the consumer will pay the current amount through the counter or over the phone. The exchange rate converts U.S. dollars into RMB for repayment.

In addition to the exchange rate on the date of entry, when purchasing foreign exchange and repaying the loan after returning to the country, you also need to convert another U.S. dollar exchange rate, which is called a "currency conversion fee", which is a procedure charged when converting non-U.S. currencies into U.S. dollars. The charging standard is mostly 1.5% of the consumption amount.

Extended information

Try to use the UnionPay channel when paying overseas. If the shopping amount is huge, you can save a lot on the currency conversion fee alone. It is best to ask more when shopping and settling. Can I use UnionPay?

You may be able to save a lot of money by keeping an eye on the exchange rate and choosing a date for repayment. In addition to currency conversion fees, the exchange rate is also an issue that cardholders need to pay attention to when swiping their cards overseas. The timing of foreign exchange purchase and repayment is very particular. The exchange rate of the US dollar against the RMB will fluctuate slightly every day. If 1 US dollar was worth 6.2 yuan yesterday and 6.21 yuan today, it means that the US dollar has appreciated slightly against the renminbi, and the repayment today will be higher than yesterday. Pay more RMB.

Using foreign card channels such as Visa or MasterCard may be affected by short-term exchange rate fluctuations, but it may not be uneconomical. This mainly depends on the changes in the RMB exchange rate. In the process of RMB appreciation, cardholders may also pay less. However, given the recent depreciation trend of the RMB, don’t pay too much attention to the interest-free period. It would be more cost-effective to repay the loan earlier or use a UnionPay card.

Generally speaking, when binding a debit card for automatic repayment, the cardholder needs to choose whether the debit card account is associated with the credit card foreign currency account. If there is no choice, the debit card account will only repay the credit card RMB account arrears. Only after the automatic repayment function of the foreign currency account is set up, the arrears in the foreign currency account will be repaid together.

If there is no associated account bound to the credit card, the cardholder also has a variety of options to choose from when repaying the outstanding balance in the foreign currency account. The most direct way is to deposit the corresponding foreign currency into the credit card foreign currency account at the bank counter, but this may require a long waiting time, and the cardholder may not have enough foreign currency on hand.

A relatively convenient method is to deposit a sufficient amount of RMB in your credit card and then call the customer service number of the credit card center to purchase foreign exchange and repay the money over the phone. It should be noted that funds deposited into credit card accounts in some banks will be used first to repay the outstanding debts in the RMB account. Only when there is an excess deposit in the RMB account, the excess deposit can be used to repay the foreign exchange purchased over the phone. Therefore, cardholders must deposit enough funds to pay off both accounts.

China News Network--Be careful when swiping cards overseas and repaying money back home, and avoid "currency conversion fees"

China News Network--Swiping cards when going abroad, you need to separate accounts to check the exchange rate for repayment

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