This updated rate will take effect on August 1, 2026.
What Does This Increase Mean For Bank Customers?
Dynamic Currency Conversion (DCC) is a fee incurred when customers conduct transactions with international merchants. This applies even to transactions made within India that are processed by foreign merchants. The increased transaction fee will affect all ATM, POS/in-store, or online transactions.
Recent Changes in Banking
The banking sector has witnessed numerous lenders adjusting their rates recently. Kolkata-based Bandhan Bank has recently increased its FD interest rate to 7.95% for select tenures.
Multiple banks have rolled out a variety of revisions and measures across their service segments, including IDBI Bank, SBM Bank India, South Indian Bank, Union Bank of India, and Equitas Small Finance Bank (SFB), which have all revised their Foreign Currency Non-Resident [FCNR(B)] deposit rates.
RBI Initiates FCNR(B)
This move by the banking industry aligns with the Reserve Bank of India’s (RBI) introduction of the FCNR(B), or Foreign Currency Non-Resident (Bank).
This scheme is designed to draw foreign investments from Non-Resident Indians (NRIs).
It effectively eliminates major costs and regulatory hurdles faced by banks when accepting these overseas deposits.
How to Avoid DCC
In light of Kotak Mahindra Bank’s recent DCC adjustment, customers can evade the DCC fee by opting to conduct transactions in the merchant’s local currency, where possible. This will ensure that the transaction does not incur DCC charges.
In terms of market performance, Kotak Mahindra Bank’s shares closed positively this week, showing gains of nearly 3%.
The shares are currently priced at ₹409 each at the close of this week’s trading.
Read Also: IDBI Bank, SBM Bank India, South Indian Bank, Union Bank of India raise FCNR deposit rates; offer up to 7.1% returns
First Published: Jun 26, 2026 12:29 PM IST
