The best exchange rate for converting Indian Rupees is achieved by always paying with a card, as it is by far the most economical option. For carrying some cash, the best choice is to withdraw money from an ATM.
In other words, the best strategy to maximize cost savings would be to consistently use a card for payments (as we will see later, in 2024, Wise card offers the best exchange rates and lowest fees in the market) and only withdraw the amount of cash needed from an ATM.
Certainly, this technique for saving the most money on your vacations might surprise you, as most currency exchange offices and banks advertise prominently that there are “no fees.” Therefore, one might think it is logical to exchange rupees at the current exchange rate and be done with it, right? Well, not quite! Everything has a cost, even paying with a card has a cost, though it may not be evident or immediately visible.
Let me tell you a secret: this website was created by a group of friends who have worked for several years in currency exchange offices, and frankly, changing cash is the worst option by far. To give you an idea of the scale of this unfavorable alternative, you should know that most currency exchange operators or bank employees have discounts for exchanging currencies compared to the exchange rates offered to customers. But even with those discounts, we never exchange cash. At most, depending on the trip, we only carry a small amount for certain payments or as a precautionary measure in case it’s required to enter the country.
So, it is clear: always pay with a card and only withdraw the necessary cash from an ATM. Now let’s see how to pay the lowest cost possible in both cases:
Which is the best card for paying abroad?
Based on our study of all the cards available in the market for the year 2024, for payments in any foreign country, travel cards have lower costs compared to traditional bank cards. Among the travel cards, Wise card offers the lowest costs.
These results are valid not only for international payments in foreign currency (Wise provides the best conditions, while other travel cards are on average four times more expensive, and traditional bank cards are on average ten times more expensive) but also for withdrawing cash in foreign currencies from ATMs outside your country (Wise incurs the lowest fees again, while other travel cards are on average four times more expensive, and traditional bank cards are on average twenty times more expensive).
Furthermore, if you want to know the exact differences in costs and functionalities among the different cards available in the market in 2024, check out our comparative study in this link. As you will see, this extensive study analyzes all types of cards (debit, credit, and prepaid) and all types of providers (banks, fintech companies, financial institutions, etc.).
Is it necessary to carry cards from our home country abroad?
As mentioned earlier, it is preferable to use the Wise card instead of a conventional bank card or other travel cards since it saves you a significant amount of money when making payments in foreign businesses and withdrawing money from international ATMs, with the lowest possible commissions.
In principle, you wouldn’t need to carry any other card, but keep in mind that if you’re planning to make payments like renting a car, you will need a credit card, as most car rental companies will require a deposit and will only accept credit cards.
If you don’t plan to make these types of transactions, it is recommended to leave your bank cards with higher balances at home and only carry an extra debit card for security purposes, with a small amount of balance in case of emergencies (imagine if your other card gets damaged or stolen, and you also lose your mobile phone, leaving you with no means of payment).
Keep in mind that in case of theft, you risk fraudulent operations with your cards, up to their limits. However, with the Wise card we recommend, your balance will never go negative, so only the amount deposited in it can be spent.
Moreover, you can instantly block your Wise card from your mobile phone, while with your bank cards, you may have to call your bank to cancel them, risking the possibility that they may not provide service at that moment due to holidays or being outside customer service hours.
For all these reasons, when traveling, it is much better to carry a debit card like the Wise card with the amount of money you’ll need. If you require more, you can easily reload it instantly through the mobile app, and if you need to block it due to loss or theft, you can also do it instantly through the app. This way, you’ll have full access to your money at all times, without paying commissions and minimizing the risk of theft.
As you can see, this card offers numerous features through your mobile phone, so it’s essential to ensure that your phone’s battery is always well charged. Keep in mind that plug types may vary in many countries. Therefore, it would be a great idea to acquire a universal plug adapter for travel, as it can be useful for any trip you have in the future. In this link, you can find a very economical universal plug adapter, as well as other ideal and necessary products for traveling.
Lastly, it’s important to know that if you plan to carry your credit card to pay deposits for operations such as car rentals, it is advisable to inform your bank in advance about your travel plans and the limits you’ll need. Remember that all cards have daily, weekly, and monthly limits, and while traveling, you’re likely to spend more than usual, so if your limits are somewhat low and you’re not aware of it, you could find yourself in a serious predicament.
What to do if my card runs out of balance abroad?
If your debit card runs out of balance while abroad, you can still obtain money in a straightforward way:
- If you have a bank card, you should contact a family member or friend who is a customer of the same bank, and they can transfer money to your account. Between accounts within the same bank, the money is transferred instantly, so once the transfer is completed, your card can use the new balance in your account. Another option would be to make an “immediate transfer” between accounts of different banks, as this type of transfer is also processed instantly.
- If you have a prepaid card like Wise, you can reload it through the App (or someone else can do it for you) and receive the money instantly.
What to do if all my cards are stolen abroad?
If all your cards are stolen while abroad, these are your alternatives to get by:
- Use the cash in foreign currency you withdrew from an ATM: You can pay with the cash in case you made a withdrawal from an international ATM.
- Exchange your home country’s currency for cash: It’s always advisable to carry some cash in your home country’s currency in case of emergencies, as you can exchange it for the local currency if needed.
- Pay with your mobile phone: If your mobile phone has NFC technology and your bank offers mobile payment services, you can link your mobile phone with your card. Even if the card is canceled or blocked due to theft, you can continue to make payments with your mobile phone without any issue.
- Have someone pay for what you need from your home country: If you only need to purchase a plane, train, or boat ticket, anyone you know in your home country can pay for it online and send you the boarding pass via mobile (or you can download it from the company’s app).
- Receive money through money transfer agencies: In most tourist cities, there are plenty of these types of agencies. Any contact you have can make a transfer from your home country so that you receive the money abroad.
- Sell your gold jewelry at a gold-buying store: In most major cities worldwide, there are numerous gold-buying establishments that will buy any gold jewelry from you without any problem.
- Sell your valuable belongings at a second-hand shop: The most sought-after and easy-to-sell items would be technological products like mobile phones or laptops, as well as high-quality clothing and watches.
- Ask for money: The easiest way to get what you need would be to ask fellow countrymen who can trust you. If you need a small amount, a perfect spot to ask would be next to vending machines since everyone gets change from them, and when you ask, people are more likely to give you something.
- Visit your Embassy or Consulate: As a last resort, the representatives of your country can provide you with assistance.
Where to find the best cash exchange rate for Indian Rupees?
As mentioned before, the cheapest way to obtain Indian Rupees in cash is by withdrawing money from ATMs.
In any case, if you wish to exchange cash for Indian Rupees at a currency exchange office or bank, an exchange rate with a margin of less than 5% compared to the official exchange rate would be considered good. A rate with a margin of 5% to 10% would be acceptable; a margin of 10% to 15% would be considered poor, and anything above 15% would be considered exorbitant.
You can easily find the official exchange rate for the Indian Rupee to your currency on Google. By subtracting the rate offered to you and dividing the difference by the official rate, you can calculate the percentage of the margin they are applying.
Generally, highly trafficked areas in tourist destinations tend to have the worst rates as they apply higher margins. Therefore, it’s best to research and find a reputable exchange establishment online instead of going to the first one you see.
In any case, if you need to exchange a small amount of money, it wouldn’t matter much where you do it in case of necessity and urgency since you would be assuming a small extra cost in the worst-case scenario.
What amount of cash is sufficient for traveling?
Exchanging cash only serves two purposes:
- It acts as an emergency fund in case your cards and mobile phone are stolen, allowing you to at least manage basic necessities like eating, making calls, reaching the embassy to request a duplicate passport, and getting to the airport to leave the country.
- It is used for making cash payments, such as in some street shops, certain vending machines, and for paying for services like laundry, phone booths, shopping carts that require coins, etc.
Depending on the number of days you’ll be traveling and your estimated cash expenses, you can calculate the amount you’ll need, which, in any case, shouldn’t be a substantial sum.
Is it possible to know if the Indian Rupee exchange rate will improve or worsen in the future?
Official currency exchange rates function like any financial market, such as the stock market. While there are analysts and financial gurus who make predictions, just like predictions about stock prices, there is no concrete evidence that anyone can reliably predict future exchange rates.
Generally, foreign exchange market rates tend to be relatively stable, and over the course of a month, they don’t fluctuate much more than 5%, unless there is an unexpected economic or political event, such as an unforeseen victory of an opposition party with a disruptive economic agenda.