DCC and MCC are two popular terms come into picture when you work on credit card processing IT projects. I have simplified for you to understand quickly.
I have selected this topic why because many Software developers working in the Card payment projects struggling to understand the real concepts. Many of the times they confusing these two concepts. So I have given specific differences between MCC and DCC in simple terms.
Dynamic Currency Conversion (DCC)
- A cardholder can do a purchase in foreign currency. For example, an Indian cardholder can do a transaction in USD while he is on a foreign trip.
- This is service offered by a Merchant to the cardholder.
- The Markup fee charged by a merchant is higher than those charged by the payment processor.
- If the cardholder wants to decline, he can do it. since it is an optional
- DCC is a special type of currency conversion
- This kind of transactions are called Card present scenarios
- In case of DCC merchant show the converted amount before buy the product.
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Mult-Currency Conversion (MCC)
- This kind of transaction only applies to online transactions.
- In the multi-currency conversion scenario, the rates are shown in the domestic currency of the cardholder
- The cardholder has a choice to buy or not to buy
- This kind of transactions are called “card not present” transactions
- At the time of settlement, the foreign currency transactions exchange to merchant local currency.