Why choose a forex card over cash for your international trip

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By the time you’re reading this, lockdowns are probably a thing of the past. International travel is back with a vengeance, and that also means having to carry a bunch of foreign currency. The wiser thing to do of course is to carry a pre-loaded forex card that can be used to pay in the currency of the country you’re travelling to. But before we unpack the comparisons of carrying foreign cash against forex cards, here’s a quick primer on forex.

What is forex?

Foreign Exchange, aka Forex, is used in many contexts. More often, in the case of currency trading. But in our discussion, forex refers to the foreign currency of the country you visit. While travelling overseas, carrying sufficient forex ensures convenience and confidence to tackle unforeseen challenges. Moreover, you will save money on international currency conversion charges levied on a standard debit or credit card. 

Forex cards vs cash - which is more convenient?

Technology and internet banking have removed all the erstwhile apprehensions while travelling abroad. One of the handiest and most effective tools to carry money in the local currency is the Forex Card. 

  • It is a type of prepaid credit card in which you can add foreign currency before departing from India. 
  • It is easy to handle, safer than carrying cash, and is accepted almost everywhere internationally. 
  • It can be swiped to make purchases or withdraw money from an ATM. You no longer need to travel with large amounts of cash and hide them in my traveller’s pouches or the inner lining of my suitcase.
  • You can use a multi-currency forex card that works in many countries.

Having said that, any globetrotter will agree that it is prudent to carry some cash at least. My own experience has taught me that situations can occur which are beyond your control. Some common ones being 

  • Landing at a foreign airport late at night, and the ATM not working. 
  • The cab card swiping machine is inoperational, or the cabbie demands cash only. 

This is when cash comes to the rescue. While visiting more than one country on the same trip, I prefer keeping USD as it acts as a universal foreign currency and is easily exchangeable anywhere.

Forex debit card vs credit cards - how do they differ?

Like cash, a credit card is also an excellent option to have as a backup, especially if you exhaust your prepaid forex card balance. But definitely not the primary mode of payment in a foreign land. Have you seen the transaction, withdrawal, and currency conversion charges? I made this mistake on one of my trips. But never again!

Another drawback of using credit cards is the fluctuation in local currency exchange rates. This doesn’t happen with a forex debit card since the rate is locked at the time of loading the card.

The Fi Money zero forex debit card and its benefits

The Fi forex debit card is an excellent travelling companion. The best part about it is that there are no forex charges levied! Neither are there any annual membership or account maintenance charges. I just make sure to load the card with sufficient money before I travel, and off we go. I can swipe or withdraw cash from any ATM where VISA is accepted, and frankly, where isn’t VISA accepted these days? 

Oops, I lost my debit card. Now what?

This is naturally going to be the next question since we’re talking about debit cards. The remarkable feature of using a Fi debit card is the ease of getting things done. Truly, they are spoiling me. When I lost my Fi debit card abroad, guess what I had to do? Tap. Yes, I just tapped on my Fi app to freeze my debit card and then raised the concern with their customer care team. All this through one app.

On a side note: this is another one of those situations where carrying some amount of cash comes in handy.

Best practices while handling your debit card abroad.

Allow me to share some more experience-based guidance on handling a forex card. Important things to note:

Don’t tattoo your card PIN on your forehead

Don’t use your card as a butter knife

Don’t….just kidding, folks; here is the checklist that I follow when embarking on an international trip:

  • I check and confirm the card's balance and validity before my travel.
  • Avoid using the forex card anywhere that requires blocking an amount or advance deposit, such as hotels, car rentals etc. Only use it to settle the actual bill.
  • If I am going away for a long duration, I request a backup card in the unlikely event of the primary forex card getting lost.
  • I make sure my phone and email notification service are active to be aware of any authorised transactions made on my card.
  • Needless to say, keep the card and PIN safe and protected.

FAQs

How much does a forex card cost?

Most forex cards come with a one-time joining fee. This could range anywhere from ₹300 to a few thousand, depending on the benefits that are being offered by the card. This cost goes towards acquiring the card, and it’s a one-time cost. After which, you only need to reload the card with more forex as and when you’re travelling.

On Fi Money, your debit card can be used as a forex card. There are no charges for using it whatsoever, and all you need to do is have INR in your Fi account. That way, you are not committed to spending all that forex on your trip abroad. You can only use as much as you need, and the rest is still available to you as INR for you to use in India upon your return.

Who is eligible for a forex card?

Any Indian citizen can buy forex for up to $10,000 without permission from the RBI. Most banks or issuing bodies ask for your passport number to be able to release forex to you. But according to the RBI, you don’t need to have your passport endorsed to obtain forex. 

That aside, banks need your address so they can courier your forex card after it has been issued. 

Which card is best for forex?

There are many forex cards that give you reasonably good offers along with your forex, for a one-time joining fee. You’re also charged fees for using the forex card at ATMs to withdraw cash or check your statement. On Fi Money, your Debit Card works pretty much like a forex card. But here’s where it scores better - you are charged absolutely no joining fee or other fees for using the card for forex payments. There’s a ₹100 charge for withdrawing cash from ATMs. 

What makes your Fi Money debit card better than a forex card is that you have to commit to finishing up the forex you’ve loaded onto your forex card. On Fi Money, however, each time you swipe your card, you’re simply paying that day’s exchange rate between Indian Rupees and the local currency. Once you’re back in India, you have the balance amount available in Indian Rupees to spend in India.

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