As international travel and foreign studies gain momentum, forex cards have emerged as a favourite for most Indians travelling abroad. They are convenient, safe, and more cost-efficient than carrying cash. Yet, on closer examination, the fees typically levied on these cards are quite different among banks and providers—resulting in some cards more than others in the long term.
High Reload And Issuance Charges
To start with, one has to pay the issuance charge, for which banks typically charge fees in the range of Rs 400-500. However, some players like BookMyForex and Thomas Cook provide cards without any issuance charges for issuance.
Reload charges also vary, with most conventional banks charging around Rs 100 per reload, although fintech platforms tend to do this free of cost.
Though these occasional or single fees do not sound excessive, for regular travellers or students who require topping up their cards more than once on a trip or school year, they can accumulate fast. Further, most operators add extra Goods and Services Tax (GST), further adding to the cost.
Cross-Currency Charges Can Bite
Forex cards are typically topped up with one or more particular currencies, and any purchase paid for in a currency loaded on the card incurs a cross-currency mark-up charge. This charge is usually 3.5 per cent of the transaction size by banks, and is often one of the lesser-understood fees that can silently deplete the value of your money.
A few newer products on the market now charge no cross-currency fees, but only in limited form and typically with other qualifications. Travellers who are visiting multiple countries, or are on a flexible itinerary that is not yet set, should include this fee in their calculation when selecting a card.
Expensive ATM Withdrawals Overseas
Even with forex cards, withdrawing money abroad may cost money. Banks typically charge anything between Rs 150 and Rs 200 per withdrawal or a percentage charge that may amount to 0.50 per cent based on the service provider. HDFC Bank, for instance, charges $2 for each withdrawal, while Axis Bank charges a maximum of $75 or 0.50 per cent of the withdrawn amount—whichever is lower.
Few providers such as BookMyForex have recently launched forex cards that do not charge ATM fees at all, although users need to verify whether the foreign ATM network charges its own fees.
Inactivity And Replacement Costs
Few customers may also find inactivity charges levied on their cards that come into effect if the card is unused for a long period. ICICI Bank, for instance, charges a fee of Rs 500 plus GST if the card is unused for 180 days. Replacements for lost or damaged cards can also cost anywhere from Rs 200-300, depending on the issuer.
What To Keep In Mind
The overall expense of keeping a forex card is not solely the exchange rate. Issuance, reloading, cross-currency, ATM withdrawal and idleness charges may all figure—particularly for longer journeys or repeated use. As such, travellers should test the initial fees as well as concealed expenses during use before selecting a card.
Selecting a card with little or no issuance and reload charges, lower cross-currency mark-ups, and less ATM withdrawal fees can save one a substantial sum of money. As online forex platforms and fintech companies increasingly compete with main street banks, tourists have more choices today than ever before—but only if they carefully read the fine print.
