How to buy forex for foreign travel

Before travelling to a foreign country, one can buy foreign currency from the dealers (including banks) authorised by the Reserve Bank of India. The amount of foreign currency that can be bought varies for different purposes as per RBI guidelines.

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The payment for foreign exchange can be made by cash up to a limit of Rs 50,000.
Travelling abroad necessitates the need to obtain currency of that country. One can obtain foreign currency only from authorised dealers which include banks. The RBI has laid down separate limits for obtaining foreign exchange for different purposes such as travel, studies abroad, medical travel amongst others.

Mode of obtaining forex
Customers can obtain foreign currency by visiting a bank branch, authorised to issue forex. Many banks also provide the facility of purchasing forex online.


Carrying foreign exchange
RBI has laid down an upper cap of $3,000 per visit on purchase of foreign currency in the form of notes and coins. One can purchase an equivalent of maximum $10,000 in the form of a forex card. The overall limit for an individual, under Liberalised Remittance Scheme for Resident Individuals is $2,50,000 per financial year.

Application
The bank may prescribe a form for application for foreign exchange. The RBI has prescribed form A2 and LRS declaration that must be filled and submitted at the time of application.
Documents to be submitted:
  • Self-attested copies of PAN, passport and visa
  • If visa is on arrival, then copy of the air ticket
Payment
The payment for foreign exchange can be made by cash up to a limit of Rs 50,000 or by way of a crossed cheque or demand draft. If the applicant holds an account with the bank, a debit instruction to the account can be included in the application form itself.

Point to note
  • The online application provided by banks allows individuals to apply for forex by submitting their Aadhaar details and OTP.
  • In case of online application, the customer will have to visit the branch to collect the currency. However, a forex card is dispatched to the address of the applicant.

(Content on this page is courtesy Centre for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Arti Bhargava and Labdhi Mehta.)
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
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