What is Forex?
Forex or foreign exchange is the over-the-counter exchange of currencies of various countries. The trading of these currencies is done according to their demand in the foreign market. A process of exchanging one currency with another, Forex facilitates trade, commerce, tourism, etc. between different countries. The foreign exchange market is considered to be the largest and most liquid market in the world. The most-traded forex currencies are the US dollar, the euro, the Japanese yen, and then the British pound. When you opt to go for a holiday outside India to the UK you would need forex for transactions in that country and when you come back, you would need to exchange the leftover pounds to INR.
How it works?
Forex is required when a country or its citizens have business interests abroad. It is also needed by someone who wishes to visit another country for tourism or even for business meetings. For instance, if a country wishes to export items, it receives forex and when it imports items, it has to pay in forex.
There are quite a few ways to buy/sell forex. You can either exchange foreign currencies through a bank or an authorized institution/dealer/person that deals in forex. For forex transactions, certain guidelines have to be followed. The documents needed to buy forex for travelling abroad are:
- A copy of the passport
- A copy of the visa (if applicable)
- A copy of the air tickets
- A2 form (mentions the amount required, the purpose of visit, amount of forex transacted in the financial year)
While travelling abroad, you can procure forex either in cash or get the amount loaded in a forex travel card. There could be a different pound exchange rate based on when you are buying and on the market fluctuations. Whether you change rupee to pound or pound to rupee today, for the transactions, the respective bank/dealer will charge a commission that may vary with each bank/dealer. If you intend to buy pounds in Mumbai from a dealer, it is advisable to check the pound exchange rate online first. The pound rate in Mumbai might fluctuate, sometimes even multiple times in a day. So, when you want to buy, search for the “pound rate today in Mumbai” online to get a more accurate idea of the ongoing prices.
A simple search for the ‘pound rate today in Mumbai’ would give you the rates for buying/selling the forex currency.
Buy pounds in Mumbai for your travel in good time and ensure that you only visit an authorised dealer for the same. And before you buy, be aware of the pound rate in Mumbai for the day. The pound exchange rates also vary based on whether you are buying or selling.
In Indian currency, residents of India are allowed to carry up to Rs. 25,000. However, if you want to carry forex from India for a leisure trip to the UK, there are a few things you need to keep in mind.
The maximum limit for carrying out forex transactions in INR to GBP is the equivalent of USD 250,000 per traveller in a single financial year, as per regulations. However, only $ 3000 equivalent GBP of that amount can be carried as currency notes – any balance has to be in the form of prepaid forex cards, Remittances, or traveller's cheques. To find the equivalent amount in GBP, you can check out the current pound rate in Mumbai. Do keep in mind that upon your return to India, only currency notes can be exchanged from GBP to INR and not coins.
Whether you wish to transact in forex for travel purposes or business purposes, it is important to understand the factors that affect fluctuations and valuations in the same. The foreign exchange is an important determiner of a country’s economic stability. The exchange rate is defined as "the rate at which one country's currency may be converted into another".
To follow the ongoing forex trends concerning GBP, you can easily search online. Just search for "Pound rate today in Mumbai" and you will be able to see how the currency is doing. Forex is subject to a lot of fluctuations, sometimes even multiple times a day. For fluctuations regarding the pound, you can search for Mumbai’s pound exchange rate. For the most competitive rates, contact Veena World’s forex service agents.
The United Kingdom decided not to adopt the euro as most other countries in the European Union. The deadline for UK’s decision to exit the EU ends on 31st January 2020. Bank of England, which is the central bank of the UK and sets monetary policies regarding the GBP, is expected to announce some key decisions regarding interest rates. The pound is shrouded in uncertainty as the forex markets have attributed a 50% chance of an interest cut. As a general rule, if the central bank of a country cuts interest rates, the currency of that country dives, which also holds true for the pound exchange rate.
Things to remember while buying Pound in Mumbai
Depending on the valuation of a particular foreign currency, here are a few things that you should keep in mind before you buy pounds in Mumbai:
- Buy well in advance: Currency valuations can fluctuate greatly. You can watch the pound rate today in Mumbai and then compare for a few days before buying. One can buy foreign exchange up to 180 days before the travel dates.
- Don’t Exchange at Airports: Forex at airports may be pretty expensive with the 5-10% charge airports apply.
- Compare rates: No matter where you buy from, make sure to compare prices. There may be different pound exchange rates at different dealers.
Do away with Traveller’s Cheques: TCs have become almost obsolete now as most establishments abroad are wary of accepting them due to the cumbersome process of encashing the same.