FAQs on Currency Exchange for Students

FAQs on Currency Exchange for Students: Currency exchange is one of the primary things considered when planning to travel abroad for studies or any other purpose. A lot of people prefer to exchange currency in their home country while some people prefer to exchange it in foreign countries as per their requirements. The cash requirement can be fulfilled by a lot of resources such as ATM withdrawal through Forex cards, international credit cards, exchanging currency at exchange centres, cheques, demand drafts etc. Let’s know more about some frequently asked questions on currency exchange for students abroad.

Why Do I Need to Exchange Currency Before Studying Abroad?

Exchanging currency is important to ensure seamless financial transactions in a foreign country. It provides you with the local currency needed for daily expenses, transportation, and unforeseen circumstances, eliminating the hassle of converting money constantly. Also, not all shops need to accept card payments. Some stores deal only in cash and that’s why it will be convenient for you to keep local currency with you for managing expenses. 

Also Read: Checking on international money transfers? Check this blog on How Foreign Remittance works

Where Can I Exchange Indian Rupees for Foreign Currency?

You can exchange currency at authorised banks, currency exchange offices, or through reputable online platforms. These entities offer competitive rates and a secure environment for currency conversion. Always compare the exchange rates offered by various service providers as mentioned above and choose the best-suited offer for you. Also, avoid currency exchange at airports and hotels as they charge higher fees and high exchange rates. Airport currency exchange rates are comparatively higher than hotels or any other place.

What Documents do I Need for Currency Exchange?

If you are exchanging currency in a foreign country or at home, the service provider may ask for a copy of a valid passport, student visa, and proof of admission to your foreign institution. Additional identification documents may be required to comply with regulatory requirements like air tickets, corresponding address proof etc. 

Is it Better to Exchange currency in India or Abroad?

While exchanging a small amount in India for initial expenses is advisable, for larger amounts, it’s recommended to compare rates locally. Factors like exchange rate fluctuations and service fees should be considered. Also, it will be difficult for you to carry a large amount of cash to a foreign country. You can simply take a Forex card with you and withdraw cash from the ATM abroad. Always stay informed about currency exchange strategies so that you can save your money in the long run.

Also Read: Planning to study abroad with an education loan? Calculate your EMI for the entire loan period through Fly Finance EMI Calculator

Can I Use my Indian Credit/Debit Card Abroad?

Yes, you can, but be aware of international transaction fees. Inform your bank about your travel plans beforehand to avoid any disruptions in card usage. Also, check whether your existing credit card or debit card is valid for international transactions. Usually, a Forex card will be the best option for managing expenses abroad. 

How Much Currency Should I Exchange Initially?

Exchange an amount sufficient for immediate needs. Avoid exchanging too much due to fluctuating exchange rates. It’s very important to create a balance between immediate requirements and the potential for better rates later. Use ATMs to withdraw cash for immediate requirements. Also, keep a close eye on exchange rates and exchange your currency when you find it lower. 

What’s the Best Way to Monitor Exchange Rates?

Stay informed through reliable financial news websites, and forex apps, or subscribe to rate alerts. Regularly monitoring rates allows you to make informed decisions about when to exchange currency. When there is an excess demand for foreign currency in a country, the exchange rate becomes low till the time the domestic goods and services are cheaper for foreigners, and foreign assets are highly expensive to generate sales for domestic things.

Are There Restrictions on the Amount of Currency I Can Carry Abroad?

Yes, there are limits imposed by the regulatory authorities of the country. Check with your bank and adhere to local regulations to avoid any legal complications. As per the revised LRS (Liberalised Remittance Scheme) of the Reserve Bank of India, Indians can remit up to USD 250,000 (nearly INR 2.7 crores as per the ongoing exchange rate) in a financial year.

Can I Exchange Leftover Foreign Currency Upon Returning to India?

Yes, most banks and currency exchange services allow you to convert unused foreign currency back to Indian Rupees. Retain the receipts and documentation for a smooth transaction. If you have a balance left on your Forex card after returning to India, you can get cash against the same by visiting the branch or office of the card issuer. 

How Can I Protect Myself from Currency Exchange Scams?

To safeguard against scams, utilize authorized exchange services, ensure proper documentation, and exercise caution with rates that appear unusually favourable. Awareness is key to avoiding fraudulent practices. Scammers usually target tourists and international students by offering low transaction fees and exchange rates. Never exchange your currency through brokers or local street vendors that offer exceptionally low rates as they do this to attract and trap customers. 

Are There Any Tax Implications on Currency Exchange For Students?

All international money transfers or remittances except for education and medical purposes in a financial year done as per the LRS will be applicable for 20% TCS over a threshold limit of INR 7 lakhs. Any transactions below INR 7 lakh in one financial year will not qualify for TCS. All remittances done for education through an education loan will be eligible for a TCS of 0.5% beyond a threshold limit of INR 7 lakh. As per the LRS, the money remitted abroad without an education loan for education will attract TCS at 7% if the amount is above INR 7 lakh in a financial year.

Can I Use Forex Cards for My Expenses Abroad?

Forex card is one of the most convenient options for managing expenses abroad. These prepaid cards can be loaded with the desired foreign currency, offering security and ease of use for various expenses during your study abroad. Also, you can withdraw cash at any time through any ATM across the country. A lot of banks offer cheapest Forex cards for international students under their dedicated schemes.

What Should I Do If I Lose My Forex Card Or Cash?

In the event of loss of your Forex card, report it immediately to your bank or card provider. Most institutions offer 24/7 helplines for emergencies, ensuring swift action to secure your finances. You can also request emergency cash delivery if your bank is providing such a service. Apply for a replacement card by paying the applicable fee.

Understanding currency exchange will help you understand how exactly it works and how can you get the local currency of the country you are visiting. Stay informed about the exchange rates, process, and transaction fees so that you can manage your money efficiently while staying in a foreign country.  

To know more about the currency exchange, loan application process, the best bank accounts for students, forex and banking experience for global students or international money transfers, reach out to our experts at 1800572126 to help ease your study abroad experience. 

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