While cash, debit cards, credit cards and forex cards are all viable options, each has pros and cons.
Planning an international trip in 2024? With multiple payment options, deciding the right one can get overwhelming. While cash, debit cards, credit cards, and forex cards are all viable options, each has pros and cons. This blog will explore the major differences between these payment modes to help you determine what Indians should opt for when travelling overseas in 2024.
What is a Forex Card?
A Forex card, likewise known as a travel card, is a prepaid travel card that permits you to load multiple foreign currencies to make payments while travelling abroad. Some forex card providers now offer zero forex markup cards, providing currency at the exact inter-bank exchange rate without adding conversion fees or markups.
What is an International Debit/Credit Card?
An international debit/credit card is a card your bank enables for overseas transactions. It allows you to make payments in foreign currencies by deducting the equivalent Indian Rupee amount plus applicable conversion charges from your linked bank account.
Comparison Between a Credit/Debit Card and a Forex Card
Card Issuance Ease
A Forex card can be started within 4-5 business hours as it is an instant prepaid instrument created specifically for foreign travel. Only basic travel documents are required to book your Forex card online. 24x7 online booking and same-day delivery is available.
Credit/Debit cards can only be obtained after opening a new account with a bank. The bank would require you to complete a KYC verification process.
Using a Card Abroad
Both forex cards and credit/debit cards are accepted abroad, but before you decide, you should consider this important factor. Credit/debit cards are rupee-based cards, so the online transaction in foreign currencies will be processed after the INR balance on your card is converted to foreign currency, so you will be charged for currency conversion.
Your bank may also charge you network service fees of roughly 1% when you use your credit or debit card overseas, depending on the international card network to which it belongs. Carrying a Forex card instead is recommended, as they offer the best exchange rates with minimal costs.
Theft or Loss of a Card
We understand losing your credit or debit card while travelling internationally can be an unsettling experience. Please first phone your bank's customer service line in India immediately to report your card as lost/stolen. This will allow them to cancel and deactivate the card to prevent fraud promptly.
Forex cards usually come with a backup or add-on card within the same kit or can be opted for while buying a new card. If you lose a card abroad, requests can easily be placed by calling or emailing, and replacement cards can reach you abroad within 3 working days.
Card Security
Forex cards are top-notch when it comes to security and safety. By logging in to the mobile app of your Forex card provider, you can easily lock or unlock the card without any hassle.
A credit/debit card is also chip and pin secured, and you can temporarily lock/unlock it for domestic and international transactions. It also comes with a complimentary insurance cover. Thus, they both have similar advantages in this respect.
Comparison Between Cash and Forex Card
Convenience
If you travel to several countries, you must carry multiple currency notes. This is not convenient at all. A more practical and convenient approach is having a multi-currency forex card, which lets you load several currencies on one card.
Rate Volatility
Unlike cash/currency notes prone to rate fluctuations, a Forex card has zero rate fluctuations, and once it is loaded, the exchange rates on the card remain fixed.
Cost-Effectiveness
You will always find foreign currency notes to be more expensive than forex cards. Foreign currency note rates are static, whereas market dynamics determine forex card rates. Moreover, demand-supply issues play an important role in determining currency note rates.
The Bottom Line
While cash, international debit/credit cards, and forex cards have their place, a multi-currency forex card undoubtedly scores higher in convenience, security, cost savings, and overall overseas payment experience for Indian travellers in 2024.
Disclaimer : Above mentioned article is a Consumer connect initiative, This article is a paid publication and does not have journalistic/editorial involvement of IDPL, and IDPL claims no responsibility whatsoever.
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