How does the currency exchange in India work?
Exchanging currency is not everyone’s forte. As it is a very niche product. People don’t travel abroad on a regular basis, hence, they don’t exchange currency that frequently. But ever since the economic reforms of the 90s which lead to increase in the income, hence, increase in disposable income, Indians are traveling abroad regularly. And add to this the cheap air tickets and the advent of online travel portals who offer economic deals. Surprisingly Indians are among the highest spenders during their trips. As per the statistics from United Nations World Tourism Organisation, an Indian spends on average 12-15 days on their international trip. Among the top spenders, Indian Tourists are in Top 20 in the world and have shown a double-digit growth since 2014.
Though all this shows the volume of growth, the most ignored and critical part of traveling abroad is exchanging currency in India, something which people don’t value much. Let us try to see why having a little bit knowledge of currency exchange will help you.
Here are the 10 things you should know before you do a currency exchange in India:
—Currency Exchange in Advance:
Always exchange your currency, at least 7 days prior to your departure. The early bird always catches the worm. Be an early bird and get the best deals.
—Do Not Exchange at Airports:
Airports are known to charge anywhere between 5-10% margin when you buy or sell currency. Only exchange currency at an airport if it is absolutely necessary.
—Shop around and compare exchange rates:
Currency exchange rates fluctuate and change every 3 seconds. So it is advisable to check around and see the rates. Buy it when it reaches a better rate.
BookMyForex allows customers to freeze a rate for 3 days. You can also set up rate alerts with BookMyForex.
—Follow the practice of 20-80:
Always carry 20% of your currency in cash and the rest, preferably, in a forex card. The cash in hand will help you to pay for any immediate expenses like cab fare, tips or a meal.
—Do not use your debit or credit card abroad:
Using your debit or credit abroad is very expensive. There are 3 charges levied on you when you do that. It is advisable to refrain from doing that unless you like to throw your money away.
—Avoid Traveller’s cheques:
Traveller’s cheque belongs in the past. And precisely for this reason, you should avoid taking your forex in a TC. Not everyone will accept a traveler’s cheque. And the ones who do, they will charge anywhere between 3-5%
Always do a currency exchange in India from a RBI authorised agent. Failure to do that can lead you to jail. And in case, you get fake notes or your forex card stops working abroad, you can’t even lodge a complaint.
—Sell your leftover currency:
Sell or encash your leftover currency. It is illegal to hold on to large amounts of foreign currency in India. You can get penalized or even jailed. You can keep notes of low value as a souvenir. As a lot of countries these days keep banning some notes, you may end up in possession of a note that will be worthless.
—Keep a spare Forex Card with you:
Just in case your card does not work because of a malfunction or is lost or stolen, you will have another one in hand. You don’t have to wait for a new card to turn up.
—Wire Transfer is better than a cash payment:
Avoid carrying large cash amounts while travelling especially in large cities. Having a large amount of cash on you leaves you vulnerable to robbery etc. It is not safe. Do a wire transfer instead as it is safe and fast.
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