The change applies automatically to existing cardholders, so customers do not need to apply for a new card, upgrade their existing card or meet a minimum spending threshold to avail the benefit, the bank said on September 17.
Forex markup is an additional fee charged by card issuers when a transaction is made in a foreign currency. The charge can increase the overall cost of overseas spending, including purchases made while travelling or payments for international subscriptions, software, education and other services.
Under the revised offering, IDFC FIRST Bank credit-card customers will not pay the forex markup, while the applicable rewards or cashback on international transactions will continue according to the features of their individual cards.
What does zero forex markup mean?
For example, a ₹1 lakh international transaction on a card carrying a 3.5% forex markup would attract a ₹3,500 markup. GST on the markup would add another ₹630, taking the additional cost to ₹4,130.
With zero forex markup, this additional charge would not apply, subject to the transaction being covered by the bank’s zero-markup policy.
The change could also affect how customers compare credit cards for overseas spending, particularly for those who make frequent international transactions or payments in foreign currencies.
