Relocating to India: Cash and Payment Changes Affecting International Assignees and Travelers
Posted by: Ashley Barry, Director, Supply Chain Management, APAC
In November 2016, the Indian government made a surprise announcement regarding paper currency. Called “demonetization”, large denomination notes were unexpectedly removed from circulation causing cash shortages which have impacted both business travelers and tourists to India, as well as international assignees living there.
This action took everyone off-guard – as it was intended to do. The government announced; “The suddenness of this move is expected to bring about significant changes in the economy and not only help provide impetus to the overall development of the Nation but also clean up the system.”
According to Cartus Destination Service Provider, IOS Relocations, this situation is causing difficulties in finding enough legal tender (cash) to pay for day-to-day items like food, restaurants, tea/coffee, taxis, tickets, entrance fees, souvenirs, etc.
The position is likely to ease after the government’s “transition phase” concludes. Whilst this is expected to be at the end of December 2016, considerably more bank notes need to be printed, and some ATMs need to be recalibrated to accommodate new size notes. Given the extent of the population and the country this is a significant endeavour.
Best Practices for International Assignees Going to India
During this transition phase, we recommend travelers and international assignees in India adopt the following best practices:
- Use a credit/debit card as much as possible to pay ahead of time for hotels, train tickets, airplane tickets, etc.
- Check the currency availability at airports. The Airport Authority of India (AAI) recently announced it would allow the opening of currency exchange counters by scheduled commercial banks at its airports across the country until December 31. However, the airport exchange counters haven’t always been able to keep up with demand.
- Consider using ATMs in small towns and even villages near tourist centres. Foreign nationals can normally take out more than the current daily limit of 2,500 rupees, however the situation is changing rapidly.
- Download taxi apps like Uber, Ola, and Meru. Meru and Uber allow foreign credit cards to be registered. Other apps let you pay with various mobile wallets.
- Bring small denomination U.S. dollar notes such as $5, $10, and $20 bills into the country, as well as 100 Indian rupee notes if available.
- Keep up to date with the latest situation via social media. There are tools on Twitter - hashtag #ATMswithCash and @getwalnutapp that provide information on which ATM’s have cash available.
Cartus will continue to monitor this situation as the Indian government’s transition phase concludes and we will update you further as necessary.