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Can I transfer money from a forex card to a bank account?

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When someone plans to move abroad, for education or working, there are a lot of things to take care of. Missing out on even a single important document can lead to a major loss of money and time. If the formalities are not taken care of, there are chances that we might end up losing the opportunity to take the admission or join the office in the given time. This is why people find it challenging in the first place. But thanks to innovative banking solutions like forex cards that simplify the overall process of handling money in the foreign countries.

These Foreign Exchange cards kill the hassle of continuously converting currencies and estimating the expenditure. They stack all of this information with the current exchange rates at one place, secured by the chip and PIN technology. But, are you curious to know how transferring money through these Forex card actually work? Let us help!

What is a forex card?

Foreign exchange cards allow holders to store and transfer money electronically while traveling abroad. Used for international payments and purchases. Foreign exchange cards are either single-currency cards or multi currency cards.

As the name suggests, single currency cards can only be loaded and saved in a single currency. Multi-currency forex cards support multiple currencies. Travelers can load and store currencies of different countries on their foreign exchange cards.

How does a forex card work?

When you purchase a prepaid foreign exchange card from a bank or money changer, the card is topped up with funds. For example, if you travel to France and England, the Euro and GBP (pounds) will be loaded as currencies on your multi-currency card. EUR/GBP will be loaded onto the card at the prevailing exchange rate on the date of purchase of the foreign exchange card.

Initial costs may be incurred only for the first time using the card. For overseas purchases, simply swipe your card over a PoS terminal, and the money will be debited from your account. The forex card automatically detects which country you are in and pays in that country’s default local currency.

Withdrawing money from overseas ATMs may incur a small fee per ATM usage. This can be easily arranged if you need to top up your forex card. Funds can be replenished at any time online or by bank transfer to the forex card issuer.

You can transfer funds to your bank account using a foreign exchange card. FX cards are similar to prepaid ATM cards and allow you to withdraw money from overseas ATMs in your local currency. When purchasing a forex card, you must load the card with at least  a minimum balance of Indian currency.

Amounts will be converted to dollars (or other foreign currency) at the prevailing exchange rate on the same day. This blog will explain how to transfer money from a forex card to a foreign bank account. The following steps will help you do all the steps correctly.

Traveling Abroad? Load All Your Cash onto a global travel Card

As currencies keep appreciating every now & then, you will obtain a higher purchasing power for discretionary spends as you travel abroad. How should you spend this money? Should you make use of your debit or credit card or cash instead?

Due to the fact that card-based transactions will involve risks of some type along with higher charges, carrying cash might appear a better option. However, carrying too much cash is not a safe option either.

A possible solution is to carry a reliable forex card and loading all of your cash to be utilized abroad. Forex cards can be used for cash-based withdrawals and transactions when you are traveling abroad. These are helpful in locking in the exchange rate at the instance when you are loading cash onto a forex card.

One of the most common observations has been that people tend to carry around 90 percent of the respective forex requirements on forex cards. The remaining 10 percent is carried in the form of cash.

It is considerably a smart strategy. In case your card gets lost, someone who steals or finds the card, they will not be able to use it because it requires a PIN. However, if you lose you cash, it will be gone forever.

Planning Your Cash Needs

Once you have made the decision of how much cash you need to carry in the forex card, avoid the task of currency exchange for the last moment -like at the airport. You will never get the best deals here -especially if you are traveling during the peak holiday season.

On the other hand, it is always recommended to make plans ahead of time while getting your forex card from a reliable forex dealer before you head for your trip.

You can expect the rates to exchange cash to be slightly higher than the rate of loading your forex card -even when the transaction is executed at the same time. Therefore, you will end up getting less forex in cash and more forex in your card while exchanging currency.

Benefits of a forex card –

  • Currency cards offer better exchange rates for adding more currency than buying foreign currency with cash. For banks, offering a foreign exchange card is a cheaper option. Typically, there is an exchange rate markup difference of 50 Paise for a foreign exchange card compared to a 2 rupee markup for buying USD.
  • Currency cards are charged with foreign currency at a fixed exchange rate. Therefore, it is not affected by currency value fluctuations in the foreign exchange market. If you load a forex card with 1000 USD, its value will be 1000 USD regardless of INR-USD exchange rate fluctuations.
  • Forex cards are safer than carrying cash around as they use chip and pin technology to protect the money inside. If your forex card is lost or stolen, it will be blocked immediately, and your balance will be frozen. You can then activate a second forex card issued with your original card and transfer your funds to it.
  • Unlike debit and credit cards, forex cards do not incur additional charges when swiping at overseas PoS counters. In addition, debit and credit cards operate abroad at exorbitant exchange rates, adding an additional cost of approximately 5-11% of total transaction fees.
  • No dynamic currency conversion fees. Forex cards are pre-loaded with foreign local currency, so there are no dynamic currency conversion (DCC) fees for use abroad. However, this fee applies to debit and credit cards. DCC adds a 3-5% surcharge to transaction costs.
  • Unlike traveler’s checks, which have become an outdated means of payment, currency cards are widely recognized and accepted. Foreign exchange cards can also be used to withdraw money abroad from nearby ATMs.However, cashing traveler’s checks is a big hassle as you have to find and accept banks and businesses. . Even taxis in some countries abroad accept foreign exchange cards as a method of payment. In fact, you can use foreign exchange cards for online transactions abroad as well. This is possible because it works like a regular debit or credit card on the Visa or MasterCard network.
  • A foreign exchange card allows you to shop at duty-free shops at the airport. When you return to India from an international trip, you may still have foreign currency on your foreign exchange card. These can be easily redeemed or used to purchase goods at airport duty-free shops. Duty-free shops only accept payments in foreign currencies. Just drag your forex card there and buy cheap goods for your friends and family.
  • Forex Cards offer better money management. Using a forex card allows you to manage your money better. It provides online access to track your spending and transactions through net banking. You also get a monthly statement that lets you know how much credit you have left on your card. At the end of your international trip, you can easily convert any leftover foreign currency into cash, so you don’t waste your credit.

Transferring money from a forex card to a bank account – The need and ease

We never know how we might come in dire need of cash. If you need to withdraw cash while traveling abroad, you can do so using a foreign exchange card. Most banks are connected to VISA so that you can withdraw cash from VISA-enabled ATMs around the world. Thus, carrying a forex card with you on a foreign trip is extremely important.

However, with the advancement of new banking facilities and technology, a newer forex card is trending nowadays. It is known as an International travel card. An international travel card is just another better forex card version that can help you with all your transactions abroad.

Niyo Global travel card is one such card that helps you benefit from a forex card. Thus, next time you travel abroad, ensure you know all the uses and benefits of a forex card.



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