Importance Of Currency Exchange Rate For Foreign Remittances From India

By Author: Nitin Motwani
Total Articles: 11
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In today’s age, millions of people globally are either working internationally or investing in a country abroad. In either case they need to be able to send money across borders. Financial transactions of this sort are called Foreign Remittance. Currency exchange rates play a pivotal role in deriving maximum value from foreign remittances.

Foreign remittances to and from India have been steadily increasing since the economic liberalisation of 1991. The formal definition of a foreign remittance is ‘the process of transferring money from one country to another through the use of a financial product”.

The Indian diaspora is spread across the world and earns a living in all global currencies. The same can be said for people from countries like the US, Britain, Europe, Japan, China and many others, where ethnic populations are moving into countries like India for employment opportunities as well as expertise sharing.

People who use these financial instruments to send foreign remittances from India can have varied purposes. They may be sending money for families or close relatives staying abroad; the money ...
... may be needed for educational or medical expenses; people may have social or religious ties that need sponsorship; even investment planning, gifting and inheritance payments require a foreign remittance.

In terms of money, the world really is a global village! All currencies are becoming a part of a worker’s wages and the personal as well as business needs for currency exchange have grown exponentially. What is needed for maximising the monetary potential while sending a foreign remittance from India is a good currency exchange rate.

For the exclusive purpose of sending foreign remittances, Indian banks have an established remittance relationship with banks in other countries along with several currency houses. Sending money abroad has to be a secure and convenient transaction. Major banks across the globe facilitate foreign remittances. Money can be sent from India electronically by SWIFT wire transfer, which is a very secure and reliable method of transferring money abroad.

Funds are also transferred using foreign currency demand drafts that can be acquired from any major bank. The demand draft can then be sent to the beneficiary who can receive funds from the drawee’s bank by producing the draft.

The variations in currency exchange rate India are quite large. There is also a huge disparity in the documentation requirements needed to process foreign remittance transactions between different financial institutions. Any individual will naturally want a hassle-free experience when processing an outward remittance transaction and would also expect the best currency exchange rates possible.

Since tracking currency rates to the second is not feasible for a common man, the exercise is best left to experts who can facilitate the transaction for you. Most Indian banks are slow and inconvenient thanks to their endless queues and many forms. The exchange rates at the licensed currency exchange bureaus are usually lesser than those offered by banks and most currency converter sites only show rates at which banks deal with themselves.

So, to derive the maximum out of a foreign remittance it is prudent to choose a currency exchange service that can provide you with real-time market rates. A good currency exchange service can facilitate the transfer of funds to your beneficiaries via trustworthy, efficient and speedy channels.

The author of this article is associated with BookMyForex, a reputed first of its kind e-commerce website, conceived with the long-term vision to use its exclusive tie-ups, large distribution network and the internet to create an organized and customer friendly foreign exchange and remittances market in India. At BookMyForex there is the option of booking a transaction at the exact rates shown on the site. These rates are derived from live and real-time market rates that are accurate to the last second. For details, visit https://www.bookmyforex.com/.