Forex travel card: Key features, charges and how it is different from credit cards

5 min read | Updated on June 07, 2025, 12:54 IST

SUMMARY

Prepaid forex cards are suitable for frequent travellers, students studying abroad and people who make investments internationally. These cards offer key benefits like multi-currency support and low transaction fees, making them an ideal payment mode.

How to use travel card abroad, travel card vs credit card

Most forex cards have spending limits on a daily basis, generally allowing only $200-300 per day.

For frequent international travellers, managing foreign currency efficiently is important. While cash and credit cards are the most widely used payment tools for travel purposes, forex travel cards are smarter, safer and more economical.

These cards have become a suitable option for occasional and frequent travelers, offering benefits including multi-currency support, locked exchange rates and low fees.

How does a forex travel card work?

A forex travel card is a prepaid card that offers a secure and cost-effective alternative to cash or using regular credit/debit cards while traveling abroad. It works like a normal debit card, allowing you to make payments and withdraw cash abroad without worrying about things like fluctuations in exchange rates.

Key features of forex travel card

Locked exchange rates: The exchange rate is fixed when you load the card, protecting you from market volatility and exchange rate fluctuations.

Multi-currency support: Some cards allow you to withdraw multiple currencies such as USD, EUR and GBP on a single card. It automatically deducts payments in the local currency, avoiding repeated conversions and resulting in increased savings.

Secure & contactless payments: It’s PIN-protected and can be blocked immediately if lost or stolen. It also supports tap-to-pay payments for faster checkouts.

ATM withdrawals: It’s cheaper than credit card cash advances, which charge high fees and interest on cash withdrawals, both domestic and international. Some banks also offer free withdrawals at partner ATMs.

Online reload and balance check: You can add more funds through net banking or mobile apps while travelling and can check the real-time balance and transaction history online.

Travel card vs credit card

Unlike credit cards that charge substantial fees for foreign transactions and ATM withdrawals, forex cards usually have lower or no foreign transaction fees and more reasonable ATM withdrawal charges.

Forex cards also offer fixed exchange rates locked at the time of loading, protecting travellers from currency fluctuations, while credit cards use dynamic rates with typical 3-5% foreign transaction markups. Forex markup is one of the major fees that you should look out for when travelling abroad and using a credit card.

Forex cards are prepaid with no debt risk, whereas credit cards carry potential fraud risks. Further, credit cards also have high-interest debt if you don’t make payments on time. Most importantly, while credit cards convert all transactions individually, leading to high conversion rates, forex cards have a multi-currency feature, allowing users to load multiple currencies on one card.

Note: According to the RBI, under the Liberalised Remittance Scheme (LRS), a resident individual can only remit up to $250,000 per financial year for permissible transactions like education, travel and investments abroad. While this is the annual limit, the daily limit varies from bank to bank.

Forex card charges and usage guidelines

Before using a forex card, users must take note of all the fees and charges applicable while making transactions. Here are some common forex card charges:

Replacement card fee: You are charged for getting a replacement card while in India. The replacement fee for the card when you’re abroad is typically higher than domestic.

Cash withdrawal charge: The fee is applied when you use your forex card to withdraw money from an ATM abroad. While this fee is comparatively lower than credit card cash advances, forex cards also have some charges on cash withdrawals.

Balance inquiry charge: On some cards, there is a fee applicable on checking your account balance at an ATM.

International SMS alert charge: There is a monthly fee for receiving transaction notifications via SMS while travelling abroad.

Charge slip charge: This is the cost of getting a printed transaction receipt at an ATM. Most ATMs will ask you if you want a printed receipt or not.

Inactivity fees: This fee varies from bank to bank. For instance, if your forex card remains unused for more than 6 months consecutively, some banks may charge you a fee.

Cross currency markup charge: When you make a transaction in a currency different from what's loaded on your card, you may face an additional charge of 3-3.5%. Some banks offer 'Zero Cross Currency Conversion Charges’, allowing free transactions in any currency.

All these charges are important and can affect your travel budget. You must read the terms and conditions of your card carefully before using it abroad.

Things to check when getting a forex card

Daily limit: Most cards have spending limits on a daily basis, generally allowing only $200-300 per day. Remember to check the daily limit so you can travel comfortably.

Activation: Understand the activation process and how to reset your PIN if lost while abroad.

24-hour helpline: Make sure you keep the emergency contact number accessible in case you need to contact your card issuer.

Usage precautions

Safety: Card fraud is common internationally, especially card cloning. Always make sure your card is swiped in your presence and prevent unauthorised transactions. In case you notice any discrepancy, immediately contact your card issuer.

During transactions: As your card holds foreign currency, avoid using it for billings in INR as it will result in high conversion fees.

At ATMs: When using ATMs or making payments, choose the credit card option since the forex card option is not usually listed.

Many forex cards come with several insurance benefits. If you can, take a card with protection against fraudulent use if your card is cloned or lost. Aim for a card with personal accident coverage and lost luggage protection so you can travel without any worries.

Some cards even have coverage for ATM-related crimes, so compare all the forex travel cards before choosing the most suitable one for you. Many major banks now offer advanced forex cards with various competitive features. Leading banks like HDFC Bank, ICICI Bank and SBI have budget-friendly options as well. While choosing a forex card, read the fine print to know all the charges and benefits and make a well-informed decision.