If you use your debit or credit card while travelling abroad or shopping on international websites, this update is important for you.
Axis Bank and Kotak Mahindra Bank have increased their Dynamic Currency Conversion (DCC) charges, which could make some overseas card transactions more expensive.
Axis Bank Raises DCC Charges
Axis Bank has increased the DCC fee on many of its credit cards from 1.5% to 3.5%. The revised charges will be applicable from August 28, 2026.
However, some premium cards will have lower charges:
Magnus and Magnus for Burgundy: 2%
Olympus: 1.8%
MyZone, Select, Privilege, and Neo: 3.5%
Kotak Mahindra Bank Also Revises Fees
Kotak Mahindra Bank has increased the DCC charge on its debit cards from 1% + GST to 3.5% + GST. The new fee will come into effect from August 1, 2026.
Earlier, ICICI Bank had also raised DCC charges on all its debit cards to 3.5% + GST in June 2026. This means most major banks now have similar DCC fees for international card transactions.
What is Dynamic Currency Conversion (DCC)?
When you pay with your card at a foreign store, hotel, or international website, you may see two payment options:
Pay in the local currency (such as USD, EUR, or GBP)
Pay in Indian Rupees (INR)
If you choose to pay in INR, the transaction uses Dynamic Currency Conversion (DCC). In this process, the foreign merchant or payment provider converts the amount into rupees, and your bank may also charge a DCC fee.
Why Are Banks Increasing These Charges?
According to experts, banks have increased DCC fees to earn more revenue from international transactions and cover cross-border payment processing costs.
As more Indians travel overseas, shop on international websites, and subscribe to global digital services, foreign card transactions have grown rapidly. Banks are now looking to benefit from this increasing demand.
How Can You Save Money?
If you’re using your card abroad, it is usually better to pay in the local currency instead of choosing INR.
In many cases, selecting DCC means you pay both the exchange rate decided by the foreign merchant and the bank’s additional DCC fee.
Before confirming any payment, always check the currency option shown on the payment screen. Choosing the right option can help you avoid unnecessary charges and reduce your overall cost.
