If you are wondering how to carry your money for your next trip overseas, here is a list of the most popular methods that you can try too!
1. Forex card
This is an easy, weightless and inexpensive way to carry money abroad. Forex card works like an ATM card, except that you will be spending your money in the foreign currency, instead of the domestic one. For example, if you are traveling to the US and you get a travel card, the amount will be shown in terms of dollars.
They are really simple to use (just like an ATM card) and one of the best ways to carry money abroad. Also, you will get quite a decent exchange rate, as your transactions will not be dependent on any fluctuations.
Many of the Forex cards available in the market are quite limited in their coverage. You might be able to use your card for carrying money to countries like the UK or USA, but you might not be able to use much if you are heading to lesser developed destinations like Kenya or Cambodia. So, it's better to get your forex card from a trusted brand like Matrix Cellular that offers good coverage in more than 15 currencies for better usage.
Forex cards also offer supplementary benefits like health insurance cover or free offers on their purchase. Most providers like Matrix Cellular offer an immediate replacement service i.e., in case you lose your card, a supplementary card will be provided within 48-72 hours that could be activated instantly.
2. Mobile wallets
With technology shaping up our lifestyle, mobile wallets have contributed a lot in the process. To add more to it, various FinTech websites like Paytm offer e-wallet facilities that can be used for paying for facilities like restaurant or hotel bookings, taxi rides in Indian currencies during your trip abroad.
These sites do not charge any conversion fee other than the basic foreign exchange rates.
3. Cash
Money is the least secure approach to cash. However, it's often a good idea to get some foreign currency before you leave home so that you have cash in your hand to handle your immediate expenses, such as taking a cab to the hotel or buying a meal at the airport. This would save you the hassle of locating the ATM or visiting the local exchange bureau immediately after landing from a long journey to the foreign land.
In spite of the fact that the Reserve Bank of India permits you to carry up to $3,000 in cash while traveling abroad ($10,000 over multiple holiday trips per year), it is advised to actually carry much less (on an average 100-150 dollars per person or less than 20 percent of total money).
If you are heading to a developed country, most lodgings, shops, and even taxis will accept plastic money and you will just need money to pay tips while eating at small restaurants, or while shopping from a street-side shop. However, if you are traveling to a secluded destination, say, a jungle safari in Kenya or an exotic Hawaiian island, you should carry more money.
4. Sending money abroad
Best for emergencies when you require cash quickly!
If you run out of money or in the case of stolen money and cards, this option comes to your rescue. Somebody at home can wire cash to you and you'll have it within a day or even in a couple of minutes.
Charges for sending cash to another country can run anywhere in the range of 1 to 10 percent or more. It usually depends on how quickly you need to send the money. The speedier you require the cash, the costlier it will be.
5. Traveler's Cheque
The exchange rate for traveler's cheques is not as great as the interbank rate you'll get while using a credit or debit card. Also, finding Money Changers and encashing the cheque might create a lot of trouble as they are not generally acknowledged nowadays. In addition to this, you'll have to pay commissions, shipping charges and/or conversion fees to purchase and cash the cheques.
But nonetheless, traveler's cheque is one of the best options for emergency backup if you can't find a functioning ATM or a secure alternative to cash.
Quick tip:
Avoid using credit and debit cards abroad. If you use your debit or credit card to make a purchase abroad, cross-currency charge will apply. While withdrawing cash from an ATM abroad through your card, you could be slapped a heavy charge of $10-25 per withdrawal.
Another disadvantage of using your credit or debit card abroad is that your exchange rate doesn't get locked in advance and, usually the rate applied could be on the day of purchase or on the day of billing. Since the rupee generally depreciates against currencies like the dollar, you could end up paying more.
In addition, as with all credit card transactions, if you fail to repay the amount within the stipulated time, an extra interest rate of 18-27 percent might be applied.
Things to remember
- Carry only a small portion, 20 percent or less, of your total money in cash and carry most of your money in forex cards.
- Do a good amount of online research before selecting your forex card to get the best forex rates. Try Matrix Forex Card.
- The conversion rate for higher denomination bills ($100) could be lower than for smaller denomination notes, so plan accordingly.
- Keep one card with yourself and another with your traveling partner. That way you can both go around independently and have a back-up if you lose one of the cards.
- This goes without saying - you should not store your card and PIN together or share your PIN with anyone.
- Keep your Traveler Cheque's serial numbers in a secure but separate place from the cheques themselves in case they're lost or stolen.
- One never knows what kind of situation might arise when in a foreign land, so it's better to carry more than one option. A debit/credit card or Traveler's Cheque may come in handy for such emergencies.