Casino Travel Tips Cambodia Singapore Uzbekistan Sri Lanka Nepal. Do Prepaid Forex Cards Make Your Holiday More Expensive? December My answer to the above question would be a "Yes" but then prepaid Forex cards do happen to exist in our world and that can only be so if there are people who find these cards useful.

The primary feature and selling point of prepaid Forex cards is that these cards are safe and secure. The safety is due to the four digit PIN that is supposed to be known only to the customer and the security is that in case the customer loses the card, they can contact their bank to block the card and prevent its misuse. Some other benefits of Forex cards that are advertised by banks are: Your bank may have compiled a list of 10 other benefits of their Forex card product but trust me, much of that would be irrelevant.

Prepaid Forex Card for Tourists Problems with Prepaid Forex Cards Before going to the costs associated with prepaid Forex cards, you need to consider another issue. Suppose you are going on a holiday to Thailand, you will need Thai Baht. But will you find a Forex card denominated in Thai Baht, I don't think so. The ten most common currencies in which Forex cards are issued are: Australian Dollar, Canadian Dollar, Dirham, Euro, Japanese Yen, Singapore Dollar, Pound Sterling, Swiss Franc, Swedish Crona, and USD.

When you withdraw THB from an ATM in Thailand using your USD denominated Forex card, you incur cross currency charges in addition to all the other charges that you pay on your Forex card. How much a Prepaid Forex Card costs you? Here is the list of charges on the USD denominated Forex card product of a leading bank in India: INR 2 USD 2.

Mentioned but not specified 7. Currency conversion Banks really suck your blood when it comes to selling you a foreign currency.

To know the inter-bank rate for USD against INR, go to Google and type 'usd inr rate' in lower case without quotes.

For Thai baht, type 'thb inr rate' and so on. Watch The Rate It is very important to watch the exchange rate at which you are loading a foreign currency onto your Forex card because your bank may not declare some charges to you upfront but charge you instead through a very bad exchange rate. Similarly, when you sell your left-over Forex balance back to your bank, the buy-back rate may be extremely low as compared to the inter-bank rate.

Your bank knows this and instead of giving you some benefit for your deposit, will rather charge you for it. Know The Gimmicks Sometimes there are so called 'special offers' on Forex cards that promise free ATM withdrawals abroad. I have verified the details of some of these offers and was told that the offer was limited to USD denominated Forex cards and that too on the first three withdrawals made within the offer period on a newly issued Forex card.

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A USD denominated card is good for travelling to a country where you can directly withdraw USD from an ATM, and there are not many countries like that.

When to take a Prepaid Forex Card The only situation when a Forex card will make sense is when you do not wish to carry cash, your home currency is likely to depreciate against foreign currencies in the near future and you need to lock in the price of the foreign currency for your holiday expenses.

Other than that, you do not need a prepaid Forex card. Options other than Forex Cards The primary competitor of Forex cards is not travellers' cheques TCs because TCs are not accepted everywhere and are not easy to encash. When you buy a Forex card and load with with a foreign currency, your cost of foreign currency gets determined. Now you own a certain number of units of that foreign currency and any future change in the price of that currency is not going to impact you as long as you can contain your spending within your Forex card balance.

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You will be charged as per the prevailing rate at the time of the transaction. It is a blatant lie, and that bank knows this.

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Cross currency charges always apply whether you use a Forex card or ATM card. See, when you buy a Forex card in USD and use it for spending or withdrawing THB, you pay cross currency conversion charges and other markup.

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In this process, when you first loaded USD to your Forex card, you actually bought USD by paying with your home currency and paid conversion charges and fees. Again when you used that Forex card to pay in THB, you converted USD to THB and again paid conversion fees and charges.

This is nothing but cross currency conversion. But the Thai bank involved in this will take USD from your bank for the transaction THB-USD conversion , and your bank will pay those USD to the Thai bank by taking INR from your account INR-USD conversion.

Effectively, you cannot escape cross currency charges regardless of whether you use your ATM card or your Forex card. Do not get misled by your bank on this. You also save on the Forex card issuance fee.

Multi Currency Forex Cards The multi-currency Forex cards on offer by some Indian banks take care of cross-currency charges to some extent. Suppose one is visiting two different countries in a single trip, say Thailand and Cambodia, it is possible to load two currencies, USD for Cambodia and THB for Thailand on to a single multi-currency Forex card. The reload fees, Forex surrender fees, sale and re-purchase at retail rates with hefty profit margins for the bank, and surrender fees, etc.

After demonetisation of Rs. The value of Indian Rupee has also become volatile in relation to other currencies.

In such a scenario, one may find taking a Forex card a convenient option. In such a case, start the process early and prefer taking a personalised card, with your name on it. If you are buying a Forex card at the last moment, you will only get a "Kit" card without your name on it. Such nameless cards sometimes get declined by vendors in foreign countries. Get all desiyatri articles by email.

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