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If you frequently travel abroad or make purchases on international e-commerce websites, you need to pay close attention to your card transactions. Leading financial institutions, including Axis Bank and Kotak Mahindra Bank, have announced significant hikes in Dynamic Currency Conversion (DCC) charges for foreign transactions. This upward revision means customers will now have to shell out higher fees when making specific card payments overseas or transacting in Indian rupees on international portals, adding an extra financial burden on global travelers.

Axis Bank Credit Cards DCC Charges Increased Up to 3.5%

Axis Bank has officially decided to hike the DCC charges across a wide range of its credit cards from 1.5% to a steep 3.5%, with the new rates taking effect from August 28, 2026. However, exceptions have been made for high-end variants: Magnus and Magnus for Burgundy cardholders will incur a 2% fee, while Olympus card holders will be charged 1.8%. Meanwhile, popular everyday credit cards such as MyZone, Select, Privilege, and Neo will attract a flat 3.5% DCC fee, significantly increasing the cost of international card usage.

Kotak Mahindra Bank Revises Debit Card DCC Fees

Following suit, Kotak Mahindra Bank has raised the DCC charges on its debit cards from 1% plus GST to a hefty 3.5% plus GST, effective August 1, 2026. This move follows ICICI Bank, which similarly hiked its debit card DCC charges to 3.5% plus GST in June 2026. With multiple major private sector banks aligning their policies, a 3.5% DCC fee is rapidly becoming the industry standard across the Indian banking sector for foreign card usage.

What is Dynamic Currency Conversion (DCC)

Understanding Dynamic Currency Conversion (DCC) is essential to avoiding hidden expenses while traveling. When swiping a card at a foreign hotel, retail store, or international website, customers are often given a choice to pay either in the local currency—such as US dollars, euros, or British pounds—or convert the bill into Indian Rupees (INR) instantly. Choosing to pay in Indian Rupees constitutes DCC. Under this mechanism, the foreign merchant or their payment processor handles the conversion, often applying unfavorable exchange rates alongside the bank’s newly hiked DCC fees.

Why Are Banks Raising DCC Fees and How to Save Money

Financial experts indicate that banks are increasing these cross-border fees to boost revenue and offset the rising operational costs associated with international payment networks and card processing. With Indian consumer spending on foreign travel, overseas studies, and international online shopping surging dramatically over recent years, banks are capitalizing on this growing market segment. To protect your wallet, experts recommend always choosing to pay in the local currency rather than INR when prompted at international terminals, as this simple step helps you bypass inflated conversion rates and hefty DCC surcharges.