Don’t get stuck with a bad bargain at the Dubai Shopping Festival 2015! Always pay in Foreign Currency while swiping your India Issued cards.
With the rise in issuance of International Debit cards by Indian banks, these cards are fast gaining acceptance as the preferred mode of payment while travelling abroad. These cards are mostly either based on Mastercard or VISA network and use their global payment systems to settle.
While shopping abroad or withdrawing money on an international debit/credit card, you are often given an option to choose the currency in which you would want to pay. Your gut lets you pay in INR as your debit/credit card is denominated in INR and hence no exchange rate applies… not a very clever option.
Let us explain
So let’s say you are in Dubai enjoying the Dubai Shopping Festival 2015.
You walk in to Carrefour and find an amazing deal on that laptop you have been eyeing at a bargain price of AED 3,500 after the 40% off. You grab it and run to bill. Out comes your International debit/credit card and the cashier asks you in which currency you would like to pay:
Paying in AED:
When you choose to pay in AED, then Mastercard (assuming your card is on the Mastercard network) converts the AED 3,500 payable to Carrefour’s banker at a near perfect exchange rate and you get charged INR 61,460 in your bank account.
Paying in INR:
While choosing this option, the banker for Carrefour (a Dubai bank) coverts the AED 3,500 you owe him at a rate that is favourable to him (not so favourable to you as he loads his own sweet commission to the international exchange rates!) and collects the INR from your account at his chosen rate.
We tried this and got charged INR 63,315 while at the Mastercard near perfect exchange rate the amount charged should be INR 61,460. That’s a mark up of almost 3%! With some other banks, it could be even worse (up to 5% mark up). So essentially, while everyone else got a 40% discount, you choose to get only 37%!
Table showing savings of paying in Foreign Currency (AED in this case)
Price of Laptop: AED 3,500
We are sure this helped you in figuring out your finances and saving more. That is why Fxkart brings to you a unique, innovative and fair method of exchanging currency. We provide to you the best exchange rates available in your city with your local currency broker or with your favourite loyal bank, all of it online.
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