Since the moment we can remember, humans used to travel. We were hunters and gatherers. We travelled to various places to get food and find shelter. Whenever we travel, we used to travel everything valuable and everyone with us. When it came to the 21st century, this millennium had evolved to such a stage that we ended the barter system. We adopted the usage of a common currency called money. However, since the last few decades, we saw the rise of digital era and fast travelling technology hike. This article will give you an overview on using different Cards for Indian Immigrants in Canada.
Cards for Indian Immigrants in Canada
Due to the fact that we can now travel anywhere globally within hours, carrying money has become essential so that we can get resources anywhere. However, there still lies two major problems. Diversity and Convenience.
Every country has their own economy and their own identifiable currency. Not all countries, but most of them has. The usage of few currencies like US Dollar and Euro have become somewhat global. Still, most of the biggest economies like India, China, Russia, Canada, Brasil, GCC relies on their own strong economy backed currencies.
So, it is not about the power of a currency anymore, it is also the convenience of using any currency on demand. Apart from this, carrying a significant large sum is troublesome. The security it needed and the resource to carry it seems difficult. That’s the reason we have Forex Cards and Travel Cards.
This article explains Forex and travel cards, their advantages, disadvantages, and how they differ from debit and credit cards.
What Are Forex Cards and Travel Cards?
Forex cards and Travel cards are used by people who travel to different countries. Eve though they seems similar and has many common characteristics, they both have distinct features as well as different purposes, uses and advantages.
Forex Cards for Indian Immigrants in Canada
A Forex card is a prepaid card made and designed in such a way that it can hold different number currencies. Unlike the traditional ATM cards or debit cards, which is connected to a bank in a country and can only transact one particular currency of default setting, a Forex card can be used to convert and use one form of currency and make payment in another form.
This help people who has to travel to various countries which obviously asks for the use for different currencies at different times. It is difficult to carry a credit card, withdraw some money, take it to the nearest foreign exchange to convert it to the local currency.
Instead of that, If you have a Forex card, it will allow the users to load different kinds of money and use it.
Travel Cards for Indian Immigrants in Canada
A travel card is mostly used by travellers. It can be used to avail various features and services that one might need during their international travels. It has many similar in style features like a Forex card, but also include various extra features to make the trip easier and comfy.
Some of the major uses of a travel card is to access travel lounges, getting rewards via various supported airlines, usages at airports or international train or bus terminals in Europe, Africa, South America, North America, The UK, Asia Pacific, GCC and middle east etc.
Advantages of Forex Cards and Travel Cards
Now, let us examine what are the major advantages of using a Forex card as well as a travel card. Later, we will discuss the disadvantages and upper hand reasons to use which at where.
1. Fixed Exchange Rate
Forex cards are always loaded with foreign currency at the current exchange rate. This prevents you from spending more if the exchange rates fluctuate later.
For example: If you have Indian Rupee with you and you load an equivalent US Dollar into your Forex Card, the card will be loaded with US Dollar rather than your initial Currency that is, Indian Rupee.
Say that 1 USD is equivalent to 80 INR. You have 8 Lakhs of Indian rupee with you. You will pay it at the relevant office and get 8 lakhs equivalent dollars which is roughly 10000 USD.
Now, assume that the USD and INR rates fluctuate and the current conversion rate becomes 1 USD = 85 INR. Usually, if you have money in your bank account of credit card, for any USD payment, you will have to pay an equivalent INR at that current inflated USD rate rather than using the rate of yesterday.
Since, Forex cards are loaded with the USD Currency itself, there is no way that the exchange value reduction is going to levy upon your INR.
So, when you purchase 10000 USD by giving 800000 INR, you will get to use 10000 USD anytime, anywhere.
Instead, if you are relying on the Debit or Credit cards, to purchase or make a payment of 10000 USD you will have to pay the live change rate which 850000 INR instead of 800000. Which means, you will be owning that currency at the rate at which you purchased it.
2. Ease of Use
These cards work like debit or credit cards and are widely accepted worldwide. You can use them for shopping, dining, or withdrawing cash at ATMs. It will be a light weight plastic card and can be carried very easily where ever you go. You will not have to worry about carrying different currencies anymore, just use one Forex card
3. Enhanced Security
Forex and travel cards are safer than carrying cash. They come with PIN protection and often include features like chip security and fraud alerts. Most of the cards have featuring android or iOS apps so that you can decide what features to use and have the ability to switch off them in case of nil need.
4. Multi-Currency Support
You can load multiple currencies on a single card rather than using different bank cards of different currencies. Using this, you can use them if you are on a multiple country travel. If you are going from India and staying a night in Dubai or Doha, you can use the card to spend in AED or QR. Later if you are passing by the United States, you can spend USD and finally reaching to Canada, you can spend CAD there.
5. Savings on Transaction Fees
Transactions using Forex cards generally incur lower fees than debit or credit cards. Banks may charge lower conversion fees or no additional charges for card usage abroad.
For most of the debit cards, there will be different kinds of taxes levied and there will be a Forex conversion charge as well as Forex transaction charge. You will be exempted from these, if you are using a Forex card.
6. Customisation on Spending Limits
Forex cards allow users to set daily transaction or withdrawal limits, ensuring better control over spending. If you are handing over your card to a family member, you can make sure that no one shops for more than a higher limit which you can easily set up.
7. Re-loadable Option
Forex cards can be reloaded online or through the issuing bank, making it convenient for students or workers abroad to receive funds from family. If you take a Forex card from India, and is going abroad like Canada to study, your parents or friends from Indian can just add some money to your card, rather than sending to you via money order or direct bank transfer, which can save a lot of money in taxes, Forex charges and many more.
Disadvantages of Forex Cards and Travel Cards
1. Limited Validity
Forex cards come with an expiry date. You must use or withdraw any remaining balance before the card expires to avoid inconvenience. However, most of the Cards are valid up to 5 years.
You can just extend it in many cases, or get a new one mostly for free. But don’t forget to use or retrieve it before the expiry since after the expiry you might not be able to use the remaining money
2. Restricted Usage
These cards may not be accepted in some countries or locations. Travellers should check acceptance in their destination country before travelling. It’s very rare, but often certain cards are not accepted at certain outlets not because they don’t accept, but their payment system might not support your card.
So, you will have to just enquire about the acceptance of your Cards for Indian Immigrants in Canada, before using the services.
3. Reloading Delays
Reloading a Forex card can take time, especially if done from overseas. This may cause delays in emergencies.
4. Exchange Rate Risk for Non-Loaded Currencies
If you transact in a currency not loaded on your card, the transaction may incur additional conversion charges. For example, if you load your card with USD and use to purchase items in Canada where they use CAD, there will be Forex transaction charges levied upon you for USD-CAD exchange rates and differences.
For this not to happen, make sure you load in multiple currencies. Instead of loading 1000 USD, load 500 USD and 700 CAD to ease of use.
5. Lack of Credit Benefits
Forex and travel cards are prepaid and do not offer credit. If funds run out, you need to reload the card to continue using it. Unlike the credit card, which offer a good amount of money as a small loan for a fixed number of weeks, the prepaid nature of Forex Cards doesn’t offer nay extra penny if your card run out of cash.
Difference Between Forex and Debit or Credit Cards for Indian Immigrants in Canada
Although Forex cards may seem similar to debit or credit cards, there are significant differences. These differences are the reason, why many people from India doesn’t use debit or credit cards from an Indian bank to do a transaction overseas. (However, they still use for any transaction to be done in India).
1. Currency Conversion Fees
Debit and credit cards often charge high fees for international transactions, including currency conversion and processing charges. Most of the Forex cards doesn’t have thee conversion charges, since they are already paid during the loading of money into them.
2. Exchange Rate Risks
Debit and credit cards use the exchange rate on the transaction date, which can vary as per the exchange rate fluctuations. For example, if the USD rate for INR is 1:80 in 2024, and if you load 1000 Dollars, you only have to spend 80000 rupees and you can use the same dollar until it finishes for the next 5 years.
But if you have an Indian bank credit or debit card, they will transact using the live value. So, if the USD – INR exchange rate increases to 1:85 in 2026 or to 1:90 in 2030, you will have to spend 90000 INR to get 1000 USD. Forex cards lock in the exchange rate when loaded, providing cost certainty.
Check the daily updated rates of CAD to INR by Bank of Canada Daily Exchange rate here.
3. Prepaid vs. Credit Options in Cards for Indian Immigrants in Canada
Forex cards are prepaid, meaning you can only spend what is loaded. Credit cards allow borrowing up to a credit limit, making them useful for emergencies but riskier for overspending. There is a chance of overspending and you will only realise it later. However, you can set limits in the official apps of credit cards, if you wish to set a higher limit to spend.
4. Security Features of Cards for Indian Immigrants in Canada
Forex cards come with limited balances and are re-loadable, minimising potential loss or fraud risk compared to debit or credit cards. If you lose a card whether it’s a prepaid Forex card or a bank credit card, there is the option to block the card instantaneously.
But, sometimes it will take time to realise that you have lost it. It might even take a day or two to search in all places and conclude that you lost it. In the cases, when your cards are stolen and not lost, the thieves will transact the highest amount immediately. Even in that case, a Forex card can only be used to get the maximum amount in it.
However, the credit cards can be used to transact the monthly maximum limit as a single EMI and to pay for something for a period of 2 to 5 years. If that happened, it might be difficult to stop it and hence you will have to suffer a huge loss recurrently.
5. Maximising Rewards: Best Practices for Card Usage in Canada for Indian Immigrants
Credit cards may offer rewards like cashback or miles, but Forex cards focus on saving costs related to foreign exchange and transaction fees. Hence the Forex cards often have less rewards compared to a credit card.
For instance, an Indian traveller in Canada using a debit card may face higher charges compared to someone using a Forex card pre-loaded with Canadian dollars. Similarly, a Canadian student in India could use a travel card to avoid hefty transaction fees on a debit card.
In both cases, the purposes is what defines the need and usage of Cards for Indian Immigrants in Canada. Forex cards are for a person who has inter-currency transactions during travels.
If you don’t travel much, opt for a Credit card, since most of your payments are to be done in a particular country only. It’s better if you load some cash and keep a 5 year or higher duration valid Forex card for emergencies in your travel kit.
Forex Cards for Indian Immigrants in Canada – Indian Context
Forex cards are highly popular among Indian students and workers abroad. They are available from most major banks, such as ICICI, HDFC, and SBI. Indian users can load currencies like USD, CAD, and EUR for studies, work, or travel. RBI regulations ensure secure transactions and fair exchange rates.
These are only helpful for students, who have to convert all their Indian rupee into CAD or USD in one go so that they can spend it for the next few years without additional exchange rates.
If you have a job in Canada or The US and get’s money as USD or CAD for salary, don’t put them in the Forex cards, rather put it in your chequing account so that you can use your bank’s Debit or Credit card in the US or Canada which will give you higher credit score as well as rewards.
Forex Cards vs. Travel Cards: Which is Best for Indian Immigrants in Canada?
Forex cards are typically the prepaid card used to load different currencies as money, so that you can spend it in respective countries where those currencies are widely used.
A Travel card will mostly have all the features of a Forex card with some extra complimentary features that can be used while travelling at airport terminals or in a similar setting. Some examples are free airport lounge access, free food or reduced rates at certain brand outlets, Discounts at certain accommodation hotels or restaurants.
Should You Choose a Forex Card or Another Option?
Choosing between a Forex card, debit card, or credit card depends on your needs.
- For Frequent Travellers: Forex cards or travel cards are ideal for reducing currency conversion fees and securing transactions. You can add more currencies like INR, USD, CAD, GBP, EUR, AED, SAR, YEN etc.
- For Short-Term Trips: A debit or credit card may suffice, but check the fees and limits in advance. If you have longer stays in a country try getting a bank account there and use their credit or debit cards for local uses.
- For Students Abroad: Forex cards are helpful for managing tuition fees and daily expenses. This will be helpful for all the money you have to take or carry or send from India to Canada. If you get a part-time job or a full-time job in Canada, make sure the salary is credited to the Canadian bank account and use their debit or credit card. Don’t credit that money directly to an Indian bank or Indian Forex or travel card.