If you have an internationally transactable credit or debit card and you think that you can do any international transaction with it, then this is not the case. According to Indian laws, many types of transactions are prohibited.
If you have an internationally accepted debit and credit card, you won’t have to worry about carrying a lot of cash with you when traveling abroad. Gone are the days when you needed to carry more cash for your expenses at international destinations. But, before starting your foreign trip, you should be aware that there are certain international transactions/payments as per Indian laws, which you cannot do through your internationally accepted credit or debit card.
Explain that foreign exchange transactions in India take place under the Foreign Exchange Management Act, 1999 (FEMA), which is effective from 1 June 2000. According to the official website of Reserve Bank of India, there are restrictions on many international transactions under FEMA.
Restricted international transactions
- Remittance out of lottery winnings
- Remittance of income from racing/riding, etc. or any other hobby
- Remittance for purchase of lottery tickets, banned/prohibited magazines, football pools, sweepstakes, etc.
- Remittance of dividend by a company to which the dividend balance requirement is applicable.
- Payment of commission on exports (except tea and tobacco) under Rupee State Credit Route
- Payment of commission on exports made for equity investment in joint ventures/wholly owned subsidiaries abroad of Indian companies
In response to a question in the “Frequently Asked Questions” section of the website, “ICC (International Credit Card)/IDC (International Debit Card) can be used for travel abroad for various purposes. However, lottery Use of ICC/IDC is not permitted for purchase of tickets, restricted magazines, etc. These are covered under restricted transactions specified in Schedule 1 of the FAME (CAT) Amendment Rules, 2015.
Explain that usually the banks issuing credit/debit cards also inform the customers about what kind of transactions are prohibited through the card. If anyone is found to have done so as per RBI rules, the Cardholder is held liable and may be debarred from holding the Card (through which the transaction is made).
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