Converting foreign currency drafts to Indian rupees - procedure and charges Home
For sending small amounts to India, dollar drafts are the most economical option Usually bank charges for making dollar drafts are low in foreign countries and by choosing a suitable bank, you can ensure that the bank charges are minimized.
Most private banks like HDFC and ICICI bank charge a minimum amount as bank charges irrespective of the draft amount. These bank charges are usually more than Rs 300 per draft. Many bank employees are ignorant about these charges and will tell you there are no bank charges. If you deposit a low value cheque in the bank, you will know about these charges, only after the amount has been deducted!
If a customer wishes to make payment through Telegraphic Transfer/ Wire Transfer for a small amount, you can provide ICICI or HDFC bank details, since you can track the transaction online. But if the customer decides to pay by bank draft, due to some reason, at a later date, you should ensure that the bank details are not included in the draft, to avoid wastage of money. ICICI bank credits your account after approximately 21 days.
Nationalized banks like Canara Bank charge a much lower amount per draft , usually Rs 75 - 100 (they charge a percentage of the amount + postage). They usually have a separate department dealing with Foreign currency transactions. A photocopy of the draft is to be submitted while depositing the draft. The amount is credited to your account after 30-45 days. If the amount is required urgently, they are willing to discount it, but the charges are substantial .
If you receive a US$ draft drawn on Standard Chartered Bank, an amount of Rs 500 will be directly deducted by their Indian branch, in addition to your bank charges. You can request the sender to ensure that the cheque is drawn on some other bank, which does not deduct additional fees.
Foreign currency drafts from buyers in West African countries like Nigeria, Benin, Ghana are often fake. Bank charges for returned cheques are very high. HDFC bank charges US$10 for US$ cheques or Euro$25.03 (approx. Rs 1500) for Euro cheques + Rs 100 for every cheque that is returned. Hence it is not advisable to accept cheque payment, when the sender is not reliable. Genuine buyers from Africa can usually arrange for payment by Western Union as they usually have an associate in USA or the Middle East
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