At 15:32 07/06/2006, Thaths wrote: > Is the exchange rate better if you used your Indian ATM card
internationally to withdraw cash in the local currency?
the best retail foreign exchange rate is almost always on a credit card used at point-of-sale (not cash withdrawal). this may work for debit cards too, but they are not always accepted at point-of-sale.
there is no such thing as a single "market rate" for foreign currency. there are buy and sell rates (ask / bid). credit card firms typically charge a commission of 2-4% above the sell rate (e.g. or the dollar if you're spending dollars and paying your card in rupees). but the sell rate they use is typically the interbank rate, where the spread between buy and sell rates is almost negligible.
when you withdraw cash at an ATM abroad, you may pay a % commission on the rate (which may be higher than for point-of-sale transactions) as well a per-transaction fee (which encourages you to withdraw large amounts of cash at a time).
getting TCs or converting notes may seem cheaper if the commission is lower, but what you need to look at is the _spread_ - the difference between the buy and sell rates. this is typically considerably higher for TC's or cash than for interbank rates charged on your credit card.
i travel a lot and always pay by credit card, unless i happen to have some local currency in cash that i need to get rid of. i also use www.oanda.com for forex stuff, including their excellent expense report tool which has the advantage of calculating real exchange rates with typical commissions based on whether you had a cash or card transaction, for the day of your transaction.
best, rishab
