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Banks warn about new currency conversion rules

The new currency conversion rule will affect Mastercard users. 

Currently, when buying foreign currency or paying for goods and services with a credit card in a currency that is different from the currency of issuance, the money is deducted from a payer’s account within several days. According to new rules, the expenses will be accounted for on the date of the payment, RBC reports.

Mastercard notified Russian banks about the new rule in its June 16 news bulletin. The rule will come into effect as soon as August 11. RBC adds that in its notice, the international payment system explained this measure by intending to improve customer experience and ensure the conversion rate transparency.

Mastercard users will actually benefit from the new conversion rule. With the national currency fluctuating as it is now, the currently applicable rules may result in higher costs for credit card users.

One important example is making purchases from foreign online stores where payments are made in foreign currency. Conversion rules also matter when paying for goods and services with ruble cards abroad – although this aspect is not so relevant right now as air travel remains suspended due to the COVID-19 pandemic.

In 2018, a story of a Russian man who paid for a dinner in London went viral on Facebook. Due to changes in exchange rates, the transaction eventually cost him RUR 10K ($140) more than the amount in the check.  

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