The rupee has crossed Rs 71 against the dollar. This means that foreign holiday just got costly. There is another important thing you must keep in mind. You can carry forex, only up to certain limits when travelling abroad. RBI allows resident Indians to freely remit $2,50,000 (This is around Rs 1.77 Crores) as on 23rd September 2019 per financial year through banking channels.
How Much Cash Can You Carry Abroad?
You or any Indian resident may carry Rs 25,000 in cash while travelling abroad per foreign trip. You may carry foreign currency up to $3,000 in currency notes or coins per foreign trip. The remaining amount can be carried in the form of store value cards, banker’s draft and even traveller’s cheques. This limit is when you travel to almost all countries in the World except a few like Nepal, Bhutan, Iran, Iraq, Libya and the Russian Federation.
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You can buy dollars or foreign exchange 180 days before the travel date from dealers or any authorized person. If the amount of foreign exchange or dollars is up to Rs 50,000; you can make the payment in cash (Rupee Notes). If the amount of foreign exchange or dollars is Rs 50,000 or more, payment is through crossed cheque, pay order, demand draft, credit card, banker’s cheque or prepaid card only. There is no specified time within which you need to buy the dollars. But, you must possess a valid passport or visa for travel to the requisite country, when buying dollars or forex.
See Also: What is Travel Insurance?
There are many ways to carry dollars like cash, travel cards and traveller’s cheque. Carry a combination of forex cards and a little amount of dollars or euros. You may also activate debit and credit cards when travelling abroad. Its wise not to use these cards abroad, as transaction fees are high.
Don’t buy or sell dollars at the airport. Airports charge a 5-10% margin when buying and selling dollars or any foreign currency. Let’s compare this to some other entities. Dealers typically charge a margin of 3.5%, banks would charge around 2.5% and online sellers just 0.5%.
There is no limit when bringing unspent dollars or foreign currency into India. Now, if you have foreign exchange in the form of currency notes, traveller’s cheques or bank notes of $10,000 or more or if the value of foreign currency exceeds $5,000 or its equivalent, it must be declared to the customs authorities at the airport on arrival in India through Currency Declaration Form (CDF).
You must surrender unspent foreign money if held in dollars or foreign currency notes and traveller’s cheques within 180 days of return to India. You may retain foreign exchange up to $2,000 in the form of foreign currency notes or traveller’s cheques for future use in a special account, if certain conditions are met.
If you are a resident Indian, you can keep foreign currency like dollars up to $2,000 in a resident foreign currency domestic account. You can keep the money in different foreign currencies like Dollars, Euros, Sterling Pounds and Japanese Yen.
Foreign tourists may bring any amount of dollars into India. But, if it’s in the form of traveller’s cheque or cash with aggregate value in excess of $5,000 or its equivalent, it must be declared to the customs authorities.
Using credit card abroad for foreign currency transactions is great, but expensive. If you use credit cards at ATMs abroad there are additional fees and if credit cards are used abroad, there are conversion fees. Fees vary across issuers, merchants and currencies vis-a-vis conversion charges which range from 3.5% to 5%. If credit cards are used to withdraw dollars or other foreign currency from ATMs abroad, there are additional withdrawal charges of 2-5%.
You can load multiple currencies on a single prepaid card. If you are visiting just a single country like the US or Australia, load only US dollars or a single currency. You can load a maximum of $2.5 Lakh a year for purposes covered by Liberalized Remittance Scheme (LRS).
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