Complete Guide to International Forex Cards

The post-pandemic surge in international tourism has begun. The travelers are resuming their passion to explore new countries and the students are looking forward to getting enrolled in their dream international universities. We can witness a steady yet enthusiastic revival of international travel all around. For instance, international tourist arrivals increased by 221 percent from January to May 2022 from the 2021 levels.

International tourism is now characterized by novel incorporations, such as the increased use of FOREX cards, cashless tourism, ‘bleisure’ travels, eco-tourism, solo tripping, and more. Whether you have always been fond of travelling or are a newbie travel enthusiast, having an international Debit card goes a long way in making your adventures hassle-free and more enjoyable. Do you want to know what FOREX travel cards are? Let’s understand them better.

What Is An International Forex Card?

An international FOREX card is similar to a prepaid ATM card, as it allows cardholders to withdraw money from an ATM in an overseas location in their local currency. When you purchase a FOREX card, you must top up the card in INR, which is then auto-converted into the currency of your international destination the same day at the prevailing exchange rate. The best part is that these cards  come with an exchange rate lock-in feature, which is immune to currency rate fluctuations. For instance, if you have loaded INR 5000 in your international card, its value will remain static, irrespective of the changes in the INR-USD exchange rate. In addition, it is possible to load a FOREX card with as many as 22 currencies and use them across 100+ countries worldwide.

However, the most appealing feature here is the absence of a FOREX markup fee. When you transact money using your usual Credit or Debit card abroad, the card issuer automatically does the currency exchange based on the current FOREX rate. However, in return for the convenience offered, the credit company will charge an overhead fee, which is reflected in your total withdrawal costs. This overseas fee is known as the Forex markup fee. This adds up to the final cost which becomes a tremendous amount at times, touching the three-four figures mark. 

However, FOREX cards help you overcome that problem. Most International Debit cards do not charge any foreign transaction fee. You can transact on an international merchant’s card swiping device or pay via an online seller’s payment gateway without extra currency conversion charges. Thus, one of the primary distinguishers of a FOREX card is that it facilitates and streams international traveling by eliminating FOREX markup charges. Thus, such cards are of utmost importance to international students, travelers, and others who are constantly travelling from one nation to another. 

Things To Consider Before Applying For A Forex Card

Foreign exchange cards are an excellent financial tool for cross-country travelers. However, the current market has abundant options, and choosing the right International Debit card might become challenging. But, if you keep some specific pointers in mind, the process becomes much more manageable. What are those pointers? Let us find out!

• When applying for a foreign exchange card, it is best to check its usage limit. All electronic cards have a daily withdrawal/transaction limit, and you must choose a card whose threshold hold is relatively high or at par with the average standard so that you can make big purchases as and when required.
• Forgetting PINs is a common issue. You should enquire about the PIN-generating method to know what can be done in case you forget your PIN.
• Thirdly, you must also gauge the rewards and other benefits of your International travel card to make the most of every purchase. For example, although it is rare to find travel cards with airport lounge access, we do have certain FOREX Cards that offer such luxurious perquisites to their customers. In addition, look out for reward points, interest-accruing savings accounts, security features, and likewise. 
• Make sure that the card you choose also has an excellent travel insurance policy, as it is the norm for reliable foreign exchange card companies to offer viable insurance policies to their customers. 

Forex Card Charges That You Should Know About

Although FOREX cards are renowned for not levying any markup fee on transactions abroad, every electronic card comes with certain charges. If you decide to use a prepaid  card, it is best to be aware of the usage-based charges that might be levied on your account, some of which are –

• ATM Cash withdrawal fee – As the name suggests, it is a fee that you pay while using an international FOREX card to withdraw money from an ATM abroad.
• Balance Enquiry Fee – It refers to the fee levied when you check your account balance at an international financial institution.
• Transaction Slip Retrieval Fee – A FOREX card company may also levy a fee for receiving a transaction slip from an ATM abroad.
• Inactivity Fee – An idle period on your FOREX card, without any debit or credit for six months or more, may fetch fines. However, some service providers have a zero balance savings account policy, implying that you do not have to stack the travel card with money all the time. 

Things To Keep In Mind

Every financial instrument comes with its own risks, and FOREX cards are no exception. Although such cards provide exceptional security, being vigilant can take the safety factor two notches higher.

Precaution 1: Beware of International Card Frauds – it is imperative that the foreign exchange card is swiped in front of you at all times. The most significant threat is cloning.

Precaution 2: Swiping – When using a FOREX card, consider the daily transaction limitations. Likewise, if you have a single-currency international FOREX card, ensure that you are not swiping it at a site where the transaction value is in a different currency than the one loaded on your card. Such cross-currency transactions can attract high fines. Thus, it is optimal to choose a multi-currency FOREX card.

Precaution 3: Yearly Transaction Threshold – As per RBI Regulations, an Indian citizen going abroad for a general visit cannot carry more than USD 10000 in a year as paper/plastic money (cards). However, according to the Foreign Exchange Management Act Regulation, a student studying abroad can be sent a maximum of USD 100000 or its equivalent in one financial year. Lastly, RBI regulations also cite that the balance on a foreign exchange card cannot exceed the limit equivalent to USD 2000.

How To Apply For A Forex Card

Step 1 – You have to submit an application with the required documents for a FOREX card, either on the website of the concerned banking institution or visit their local branch.

Step 2 – After submitting the form, you have to pay an amount of INR as a submission or joining fee.

Step 3 – You can load the card with INR and make online transactions after activation.

Step 4 – Apply for the physical card, which may take seven to ten days to reach your doorstep.

Likewise, some of the documents required to apply for a FOREX card are – 

1. Passport (Self-attested copy)
2. Visa(s), in case the trip involves more than 1 country 
3. Airline Ticket (Self-attested copy)
4. PAN Card
5. Application Form
6. Insurance (not mandatory)

Now that we know the required information, let us wrap up this article by examining the veritable benefits of this international travel card. 

Benefits Of A Forex Card In 2022

• Save Money – The best part about an international travel card is that it saves you from the losses coming from fluctuation of currency value in the forex market. This is how they prevent you from losing money in exchange rate alterations. 
• Spend Without Worry –As FOREX cards do not have a markup fee, you save anywhere from 5 to 11 percent on transactions abroad. Thus, the more you save, the more freedom you have to spend on things or experiences of your choice.
• Your Hard-earned Money is Safe – You can focus on your itinerary, as the safety and security of your finances abroad are well taken care of. A Forex card is enabled with a chip and pin technology that protects your money. Moreover, if you lose the card or it is stolen, you can easily block it, and the balance will be frozen.
• Easy to Transact in Multiple Foreign Currencies – The best international cards permit travelers to load different currencies, meaning that diverse international trips become hassle-free. In addition, they are also accepted in all international ATMs and online transactions abroad.

So, there we have it, a complete guide to the International FOREX cards.

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