Junkets get easy with prepaid $ card

The chairman of a leading Indian information technology outfit found himself hungry though he had $5,000 in travellers cheques and another 1,000 pounds sterling in his pocket.

For want of change in terms of small coins, the chairman of this $1 billion IT outfit could not get himself a can of coke and hot dog, while he waited at a bus-stand in Belgium.

Such occurrences are not rare for corporate travellers today. The introduction of foreign travel prepaid dollar cards by Indian banks has offered convenience to outbound travellers who can buy goods and services across the globe just by swiping a debit card.

Essentially, a foreign travel card is a multi-use prepaid (ATM access and point-of-sale enabled) card, today, loadable only in dollars.

Apart from withdrawal of cash from 800,000 Visa ATMs, the card enables the customer to purchase goods and services directly by swiping the card at point-of-sale machines at merchant establishments.

This offers all the convenience of plastic money at merchant locations worldwide that have electronic terminals.

Citibank, UTI Bank and State Bank of India (SBI) launched their respective international prepaid travel cards, enabling overseas travellers the convenience of making purchases at the point-of-sale "" free of cost.

What's more, if a traveller suddenly finds himself out of cash, he can go any ATM , swipe his card and take out cash in the denomination of that country.

State Bank of India (SBI) deputy managing director T S Bhattacharya says: "The card is really meant for corporate travellers and not so much for the individual who usually prefers to use his global credit card."

Safer than travellers cheques, the foreign travel card is protected by a 4-digit secure PIN that prevents anyone else from using the card "" even if it is lost or stolen.

A call to the 24-hour helpline service across the globe in the event of the card being lost, stolen or misplaced, will block all further transactions.

What's more should there be a delay in one's checked-in baggage or loss of documents, SBI's card takes care of it all through the comprehensive travel insurance cover.

So how does the foreign travel card compare with travellers cheques (TC) or credit cards? Even on a gold credit card, the limit stands at roughly $2,000-3,000, unlike the foreign travel card, which can be topped up to a maximum of $ 10,000.

What's more, unlike a TC where banks levy 0.5 per cent handling commission, which can amount to $ 5, here a card holder only needs to pay Rs 50 for reloading his card and no further charges are imposed subsequently at the point of sale.

The travel card can be purchased for an amount ranging between $ 500 to $ 10,000, with re-loading facility, subject to individual entitlement as per the prevailing the Reserve Bank of India (RBI) rules.

Citibank's travel card makes it mandatory for the physical presence of the customer at the time of reloading. SBI on the other hand, proposes to enable a relative in India to help the customer reload his card at any of the SBI branches.

The exception in the case of Citibank will be for the corporate traveller who maintains an account with an authorised money changer or with the bank.

Card holders can monitor their spends anywhere in the world. Citibank enables this feature through an electronic statement delivered by email. Cardmembers can also call Citiphone in India, to report a lost card or to check the balances on the card.

SBI offers customers the option to check their balances either on their mobile for which there will be no cost. Alternatively, they can also check their balances through ATMs.

"Customers doing so through SBI ATMs will not be charged. Those accessing other banks' ATMs will be charged a nominal fee of 40 cents," said Bhattarcharya.

So what does this innovative product cost an outbound traveller? SBI offers the card for just Rs 100 and till March 31, 2004 the bank will not charge any fee.

For every reload on the card, SBI will charge Rs 50. Not a bad investment for just Rs 100, especially since the product has a two-year validity.