Studying abroad at prestigious universities is a dream for many Indian students. This often comes with financial challenges. To meet the high expenses of foreign study, many financial institutions offer Education Loans to students. These Education Loans are a feasible source to fund students' Education abroad.

Once, obtaining an Education loan, managing finances abroad can be quite challenging for students. Especially when it comes to paying Tuition Fees. Among various payment methods, a Forex card is one of the famous choices by students due to its convenience, competitive exchange rates, and flexibility of using it.

Today, we will learn all about the Forex card. What is a Forex card? How does it work? Can you use a Forex card to pay your tuition fees?

What is a Forex card?

A Forex card is a prepaid travel card one can use to load funds in a foreign currency, and then use it to pay for expenses abroad. It is more of a debit card for abroad that one can use for withdrawing money from ATMs, swiping at PoS(Point Of Sale) merchant outlets, or paying online for any purchase, etc.

Concerning students, there are some student-specific Forex cards that can help them manage finances efficiently abroad and also come with a lot of benefits.

How does a Forex card work

1. Buy and Load

  • You buy a Forex card from a bank, financial institution, or a Forex provider.
  • Load the card with the required foreign currency, ex.USD, EURO, etc
  • You can reload the card online or with the card provider if you run short of funds, with applicable reload fees.
  • The interesting part is that the exchange rate* is locked in at the time of loading, which means it is not influenced by market fluctuations.
    *Read: How Exchange Rates Affect Repaying Foreign Student Loans

2. Use Abroad

  • You can use the loaded Forex card as a debit card for any financial transactions, such as shopping, ATM withdrawals, etc.
  • The amount is debited from the forex card in the loaded currency(USD, EURO..etc.)
  • A notification is sent for each transaction via SMS or email.

3. Safety& Security

  • Forex cards are generally safer than carrying a larger amount of cash.
  • Forex cards often come with all the safety features of a credit or debit card.
  • You do not have to worry about the loss or damage.
  • In case of loss or theft, one can easily have access to block the Forex card.

4. Applicable Charges

  • Though Forex cards are often offered at competitive exchange rates, there are some applicable charges.
  • The charges may include ATM withdrawals, reloading fees, charges for issuing, etc.
  • It is important to review and research the applicable charges before buying it.

Can I pay University tuition fees using a Forex Card?

  1. Yes, you can pay your tuition fees using a Forex card. However, not all Universities or Colleges accept this method of payment. Universities often prefer wire transfers, which are considered the most secure method of payment.
  2. Before considering paying Tuition fees using a Forex card, it is advised to confirm with your University or College whether they accept a Forex card to pay tuition fees or not. If the university denies it, wire transfers are the best alternative option.

How to use your Education Loan Funds via a Forex card?

Now we will explore how to use your Education Loans effectively using a Forex card. Once your Education Loan is sanctioned and disbursed by the lender, students can use it to manage their finances. These finances include tuition fees, accommodation, travel, and day-to-day expenses.

  1. Coordinate with the lender: Not all lenders transfer money directly to a Forex card. Coordinate with the lender for a possible smooth functioning. Usually, lenders disburse the Loan amount to the applicant's or co-applicant's savings account. From there, the required foreign currency can be loaded onto your Forex card via an authorized Forex dealer or bank.
  2. Choose an Authorized Forex provider: only an RBI-authorised Forex provider can issue Forex cards. Banks such as SBI, ICICI, AXIS, and HDFC offer forex cards. Students can choose the provider based on better exchange rates and lower reloading fees.
  3. Load the Forex Card with the Required Foreign Currency: Load the loan amount to the Forex card in your destination currency, ex, USD, GBP, EURO, etc. Students are required to check the exchange rates and the charges that are applicable before loading the currency.
  4. Use to Pay Tuition Fees (if accepted): Some Universities may accept the fee payment via a Forex card. In such cases, students can avail this opportunity and pay the tuition fees. However, not all universities accept the Forex Card payment in such cases,
  • Students can withdraw from the Forex Card to pay the tuition fees (if allowed).
  • If not, students can directly pay the tuition fees through a bank transfer and can use the Forex card for living expenses.
  • Most Forex cards have the facility to track spending, reload the funds, and check the balances. 

Now, when you go via WeMakeScholars, an organization partnered with over 15 public and private lenders, we have a dedicated post-sanction team to resolve any Disbursement issues you may face in your Education Loan in no time. Get in touch with us today to experience a stress-free student loan journey.

Pros and Cons of a Forex Card

Benefits of a Forex Card

1. Convenience and Security: It is easy and convenient to carry foreign currency abroad. Instead of carrying wads of cash, it is convenient to carry a single Forex card. Forex cards often come with all the safety features of a credit or debit card. You do not have to worry about the loss or damage. In case of loss or theft, one can easily have access to block the Forex card.

2. Global Acceptance: Forex cards are widely accepted at most merchant outlets, making them convenient for all foreign exchange uses. Has access to online purchases and transactions on international websites.

3. Exclusive offers and Discounts: Forex cards often come with exclusive offers and discounts and are ideal for students who can earn reward points for each use. 

4. Access to Multiple Currencies: A Forex card has the option of loading and managing multiple currencies on a single card. This makes your international trips more convenient and accessible, and you can use a single card for multiple countries.

5. Locked-in Exchange Rates: When you load your card, the amount is saved from currency fluctuations. The loaded currency is protected from market fluctuations.

Disadvantages of a Forex Card

1. Withdrawal Charges: While card payments are free with Forex cards, withdrawing cash from ATMs using Forex cards may incur extra charges.

2. Tuition Fee Acceptance Issues: As previously discussed, not all universities accept tuition fees via a Forex card. This may need students to keep some cash as aback up.

3. Reloading Problems: To reload a Forex card, sometimes students or parents must contact the card provider and submit the required documents. Activation may take up to as long as 24 hrs. 

How to Choose the Best Forex Card Provider with the Best Education Loan

  • You can get a Forex card from banks or an RBI-authorized* Forex provider. Students have to compare features, fees, and user reviews before choosing the best Forex provider.
  • Documents such as a passport, a visa, a Government-approved ID card, a PAN card, and a confirmed air ticket showing travel abroad.
    *Read: RBI Education Loan Guidelines

Things to consider before choosing a Forex Card

  1. Understand your Needs: It is important to understand the spending habits of the student. Choose between a single-currency card or a multi-currency card, as per your requirement. Then, load the currency of the destination country.
  2. Know about Forex Card Features: Research and know about the features of the Forex card. This helps you choose the best Forex card from the Forex card options
  3. Security Features: You will be in a new country altogether, and there are chances that you may lose your Forex Card, so better to know the Forex card replacement terms. The security feature of the Forex card will let you get a replacement card with the remaining balance.
  4. Opting for Education Loan Providers: Generally, lenders who provide Education Loans also issue Forex Cards. Therefore, opting for Forex cards from the same Education Loan provider comes with a lot of extra benefits. Many public and private lenders are offering a wide range of Forex cards with a lot of discounts and exclusive benefits.

Conclusion

Forex Cards are known for their convenience with respect to financial transactions abroad. In this blog, we have discussed what Forex Cards are and how they work. We have also explored whether a student can pay the tuition fee using a Forex card or not. Apart from that, we have also covered some important things to consider before choosing a Forex card.

Oftentimes, many students borrow a smaller Education Loan amount than what they are eligible for. As a result, they struggle to manage their student loan finances, not having the right guidance. This is why at WeMakeScholars, we advise our students to take the complete amount required for their education. Get in touch with our team today to get expert guidance and complete support for your Education Loan.