10 Costly Mistakes to Avoid When Using a Forex Card Overseas

When travelling overseas or studying abroad, having a well-prepared payment strategy is crucial. Using a forex card can make life easier, but without careful planning, mistakes can be costly. In this article, we’ll walk you through 10 costly mistakes to avoid when using a forex card overseas, to ensure that when you send money overseas or transfer money overseas, you’re doing so in the best way to send money abroad.

Not checking the fine print on fees

One of the simplest yet most expensive mistakes is neglecting to examine all the fees associated with a forex card. Many cards appear appealing but embed hidden charges, such as currency conversion mark-ups, ATM withdrawal fees, inactivity fees, or high overseas transaction surcharges. According to industry guides, travellers frequently pay more through unrecognised fees than through poor exchange rates.

Before you commit, ask: What is the exchange rate used? Is there a foreign-transaction fee? Is loading or unloading funds charged? Is ATM access expensive abroad? If you overlook these questions, you could negate any benefit of the card.

Using the wrong card type

Choosing between a single-currency and multi-currency forex card matters more than you think. If you are travelling to multiple countries with a single-currency card, you’ll end up paying cross-currency conversion charges (typically 2–3.5%) on every transaction.

Failing to maintain a backup payment method

If the card you planned to use fails (blocked, lost, a malfunctioning ATM, or a network problem), you risk being stranded. It is suggested to have a backup card (or cash) just in case. So, bring a second card (from a different issuer if possible), or ensure you can access funds another way. That reduces risk and gives you peace of mind.

Withdrawing cash excessively abroad without planning

Withdrawing cash from ATMs abroad might incur large fees (both from the overseas bank and your card provider). Multiple withdrawals compound costs, and your card might impose higher mark-ups. Instead, plan your cash needs, withdraw sufficient amounts less frequently, and check the charge schedule. Where possible, use card payments rather than cash to avoid cost and risk.

Choosing to pay in your home currency instead of local currency

This is a common trap: when making a purchase overseas, many are offered the option to pay in home currency or in the local currency. Opting for your home currency may sound easier, but it is usually far more expensive, as the merchant’s conversion rate is unfavourable.

Always pay in the local currency when abroad. Let your card provider handle the conversion (preferably at a competitive rate) rather than the merchant.

Believing the exchange rate won’t change

Many travellers assume the conversion rate is fixed at departure. In reality, the rate can move right up until the moment the card transaction is processed. If you have pre-loaded currency or your card performs automatic conversion, you may be exposed to currency fluctuations.

If you’re making large purchases or ongoing spending abroad, monitor the rate and pick a card or service that offers favourable conversion and locks or transparent rate handling.

Neglecting the timing of your card usage or fund loading

Linked to the above point is timing: loading money too early (and holding foreign currency) or loading too late (and catching a worse rate) can both be costly. If you plan to send money abroad as a remittance or use your card for travel, treat your card usage like a mini-foreign exchange (FX) transaction: consider conversion rates, loading time, rate volatility, and whether your provider offers alerts or favourable conditions.

Being strategic about when you load the card (or make large transactions) can help you avoid poor rates and unnecessary costs.

Not checking country- or merchant-specific restrictions

Some countries restrict foreign cards, some merchants reject certain issuers, or you might face additional surcharges (for foreign cards, card-not-present, etc.). If you travel frequently or plan to transfer money overseas via card payment (e.g., booking tuition, rental abroad, large purchases), check acceptance in the destination country and at the merchant type (online, POS, hotel deposit, car rental).

If you assume full global acceptance without verification, you could face declines or forced conversions at unfavourable rates.

Ignoring tax/regulatory or transfer-scheme implications

If you are sending significant amounts abroad (for tuition, investment, or relocation), you need to be aware of regulatory implications (e.g., for Indian residents under the LRS scheme) and how your card spending or remittances might be treated for tax or compliance purposes. Also, your remittance or forex loading might incur Tax Collected at Source (TCS) in India beyond a threshold.

Failing to ascertain these aspects might mean you unexpectedly trigger additional costs or compliance burdens, even if your card seems low-cost.

Treating the card like a set-and‐forget tool

Many people get a travel or forex card, load money onto it, and then stop keeping track of it. But it’s important to check your card’s status and activity regularly. Misuse, declined payments, reaching daily limits, or even losing your card can happen anytime. It’s also a good idea to keep an eye on your balance, recent transactions, and any extra fees like ATM charges or currency conversion costs.

Final Thoughts

If you’re looking for a robust solution when you send money abroad or use a card abroad, one modern and competitive option is Niyo. Niyo’s Zero Forex Markup Cards allow you to load funds in INR and spend or withdraw in 130+ currencies across 180+ countries, without the extra conversion fee that traditional cards impose.

Key benefits include:

• Zero forex markup on international transactions, meaning you pay the standard VISA exchange rate with no added charge.
• Loading in INR, convenient reloading via UPI/NEFT, and managing via app.
• Additional perks like airport lounge access, in-app management, security controls and real-time alerts.

By choosing a card like Niyo and avoiding the costly mistakes above, you can travel abroad more confidently, manage your foreign spending more economically, and ensure that when you transfer money overseas or shop abroad, you’re doing so in the best way to send money overseas.