What Is the Forex or FX ?
Forex Services or Foreign Exchange Services is exchanging a particular currency for another or converting cash to another. Foreign exchange transactions comprise everything from a traveler’s money conversion at an airport kiosk to multi-billion dollar payments processed by governments, corporations, and financial institutions. This article discusses the various Forex Services that one may opt for in India.
Foreign Currency Travellers Cheques
Banks offer Foreign Currency Travellers Cheques (FCTCs), a safe and easy way to protect money during international travel. FCTCs can be encashed when needed and only against the holder’s signature, unlike cash which has the possibility of being stolen or misused by anybody. Loss of a Travellers Cheque can be reported anywhere in the world by making a single phone call, and the pre-fixed amount on the cheque is refundable to the holder/ buyer. Travelers’ Cheques are offered in major currencies such as USD, GBP, Euro, CAD, AUD, and JPY. Travelers’ Cheques are available in various denominations to suit clients’ needs. Currently, many Indian banks offer American Express Travellers Cheques, which are widely accepted at Merchant Establishments and Financial Institutions across more than 200 countries.
Foreign Currency Cash
Banks sell foreign Currency notes to their clients to meet expenses on travel abroad. Foreign Currency is a convenient way of meeting personal expenses during the journey, paying for taxis/ internal travel, food expenses, etc. Usually, currencies sold are in USD, GBP, EURO, AUD, and CAD.
Foreign Currency Demand Drafts
Banks in India offer FC Demand Drafts to their clients for various expenses such as the following.
- Payment of fees at any foreign university
- Making a gift remittance to a relative or friend
- Application fees are paid to register for exams like TOEFL, GMAT, etc.
- Payment for medical treatment abroad
- All other permitted purposes as per the RBI guidelines.
FC Demand Drafts are typically issued in seven currencies: USD, GBP, EURO, AUD, NZD, JPY, and CAD.
Deposit of Foreign Currency Cheques
Clients can deposit their foreign currency cheques, currency demand drafts, and Travellers’ Cheques into their savings or current accounts. The bank will then have the cheques sent for collection, and on being honored, the funds will be credited to the client’s account in Indian Rupees. Banks in India usually accept cheques of various currencies like USD, GBP, EURO, JPY, Australian Dollars, Canadian Dollars, UAE Dirhams, Hong Kong Dollars, and Swiss Francs. The collection period could vary from 2 international working days for Euro cheques in Frankfurt to 5 days for USD cheques in New York and 10-15 working days for accepted drawn in other currencies at other centers.
