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How to exchange currency in India?

Discussion in 'Travel advice' started by Dan1979, Nov 1, 2016.

  1. Dan1979

    Dan1979 New Member

    I will be going to India very soon for a holiday with my girlfriend. One of the worst things to have when on vacation is running our of cash in the local currency.

    I always make sure I know where I can exchange money from where ever I go on vacation, and this time round I need to know how to exchange currency in India.
    I have heard a lot of stories about being cheated and ripped off in India, so it is important for me to find the right place which exchanges currency.

  2. briannagodess

    briannagodess Well-Known Member

    Hi there, welcome to the forum!

    How to Exchange Currency in India?

    You actually have several options for exchanging your currency for the local currency in India. In this little guide, I would take you through your different options, highlighting the advantages and disadvantages of each. You can also use a combination of these options and decide for yourself which of them is the most convenient and also the one that gives you the best rate for your money.

    Summary of Different Currency Exchangers in India

    Airport's Currency Exchange CountersEase of access for those coming from other countriesUp to 15% loss in exchange rate
    Private DealersSome offers the highest exchange ratesSome private dealers are not authorised by the government
    Authorised Company DealersBetter rates as compared to banksNot widely available especially at remote cities
    BanksWidely availableNot as competitive when it comes to rates
    ATMExchange your currency directly from the machineSome cards have hidden bank fees
    From the table above, you can see your different options for exchanging your country's currency in India. You have a total of five options and each of them has their merits. But to truly decide which is the best option for you, let us dig deeper and understand each of them.

    In-Depth Discussion of Different Currency Exchangers in India

    1. Airport's Currency Exchange Counters - Since it is illegal to bring Indian rupees abroad, you cannot exchange your money while you're in Australia. Once you arrive in the airport, you would find several currency exchange counters. The good thing about them is that they are open 24 hours in a day so regardless of what time you reach the airport, you can exchange your hard currency anytime. There's a big downside to utilising these counters though, their exchange rates are not that good. In fact, you might lose up to 10% in the rate of your exchanged money here. Why? Because the rental rates for these counters in the airport are quite high. Additionally, they have to add in the taxes, manpower fees and of course the dealer's commission. All these factors are the reasons why it is not really recommended to exchange your hard currency in the airport. If you must, only exchange a small amount that can get you by until the next day, when you can exchange your currency into another dealer.
    • Tip - Only exchange up to 100 USD or 135 AUD, if you must exchange money at any Indian airport.
    2. Private Dealers - You can find both authorised and unauthorised private dealers. Of course, the rule of thumb is that the authorised private dealers are more reliable and also, they give you a receipt for exchanging money with them. On the other hand, unauthorised private dealers usually give good rates only because they don't pay taxes. Plus, if ever you have issues with changing your money with them, you cannot go after them as usually there are no receipts given in the process. Therefore, it is quite risky to deal with unauthorised private dealers and also very illegal and might put you in a bad scenario. It's better to go for authorised ones, usually they are smaller than well-known company dealers but provide quite good exchange rates. In fact, in comparison to bigger companies, these dealersThey are also located conveniently within one another so you can compare exchange rates and find which one has the best deal.
    • Note - Make sure that you're interacting with an authorised money exchange dealer.
    3. Authorised Company Dealers - Big names such as Thomas Cook and Cox & Kings usually have some stores around the main cities in India. They also give good rates, relatively higher as compared to banks but lower than private dealers. The good thing about such companies though is that you're sure that they are authorised by the government. But you won't be able to find them in all cities in India, most especially in the more remote areas. Plus, they usually require some form of identification as well so bring your passport or any other ID with you.
    • Good companies - Thomas Cook, Cox & Kings or Travelex.
    4. Banks - There are plenty of banks around India that offer foreign exchange services to clients too. While their rates aren't that competitive, usually most banks have the same rates, you're quite assured of the deal you're getting. Plus, there's that convenience of finding different banks in the country, no matter where you go. Banks also give you a receipt so when you need to convert back the rupees into Australian dollars, you can do so easily.
    • Banks in India - SBI, ICICI, HDFC Bank and Axis Bank.
    5. Automated Teller Machine (ATM) - You can also just bring your ATM card and withdraw cash directly from any compatible machine in India. While seemingly painless, there are some issues still. First of all, make sure that your bank doesn't have hidden charges beforehand. Inquire about their policies for withdrawing money from a foreign country's ATM and whether they have charges for it. There's usually a 1% foreign transaction fee, local conversion fees and other hidden charges that you must know. Another issue is that your card might not work in all ATMs so you might need to bring two or three, just in case the first one doesn't work. There's also daily limits that are imposed by banks so if you reached the limit, you must find another bank's ATM.
    • Note - Withdraw all that you need in one translation or else you would have to pay for all the transaction fees again.
    While you have many options, not all of them provide you with the best rate for your money. Make sure that you pick the right one for you and enjoy your trip to India!:)