Things NRI Should Know About How To Exchange Currency In India?

If you live abroad, you may often wonder, 'How can I exchange foreign currency when travelling to India?' This question is crucial for managing your finances during your trip, ensuring you have the right currency for transactions and avoiding unnecessary complications or losses. Understanding the best methods for currency exchange can make your travel experience smoother and more convenient.

Let us look at the various ways of currency exchange for NRIs in India.

• Any individual is permitted to bring foreign currency into India. However, there are a few restrictions imposed on the amount.
• You must declare foreign currency to the Indian Customs authorities using the Currency Declaration Form if you bring more than USD 5,000 cash or its equivalent in another currency or is more than USD 10,000 or its equivalent in any other currency either in cash, a forex card or traveller's cheques.

Exchange through banks 

You could exchange your foreign currency in the Indian bank where you have opened a NRO Account. For instance, HDFC Bank provides this walk-in facility to all its NRI clients in the form of NRI banking services. The bank charges a nominal transaction fee. Sometimes, for verification purposes, the bank may ask for identity and address proof. If you carry out a currency exchange in India in this way, the Know Your Customer (KYC) requirements should be up-to-date.

Approved money exchangers

Another way to exchange your money in India is through an RBI-approved money changer who either is an Authorised Dealer Category II or has a Full Fledged Money Changers licence.

Approved money exchanges allow you to sell foreign currency without needing an account. With more dealers than banks, they often offer competitive rates. You can select the best price, but be prepared to provide documents to verify your NRI status for the transaction.

ATM withdrawals

The simplest means of currency exchange in India is through an ATM. You could use your ATM Debit Card of the country of residence to withdraw the required amount. Banks may charge an exchange rate transaction fee as well as a service fee when using your ATM card overseas. This is a secure and straightforward means to withdraw a specific amount each time.

Direct money transfers

Nowadays, banks offer the facility to transfer direct funds to your home country before the commencement of your travel. Using NetBanking and MobileBanking, transferring money from one bank account to another is easier.

Comparison of exchange rates

This is an essential point an NRI should keep in mind for foreign currency exchange in India. Before you travel to India, compare the exchange rates and service fees charged by the banks and money changers. Doing this lets you find the best option for you and get the best value for your currency.

When you exchange foreign currency through your bank or any money changer, you must provide them with KYC (Know Your Customer) documentation. RBI has instructed all banking institutions and authorised money changers to ensure the customer’s identity and address proof.

You will need any one of these documents for the sale of foreign currency in India:

• Indian passport - this is obligatory for any transaction over INR 25,000
• PAN card
• Aadhaar card
• Copy of driving license
• Overseas address proof (utility bill, foreign driving licence, etc.)
   

These are some pointers an NRI should know about how to exchange currency in India.

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Migrating to India soon? Read more on how to change your NRI investments in India.

* The information provided in this article is generic in nature and for informational purposes only. It is not a substitute for specific advice in your own circumstances.