What is Outward Remittance Charges?
In an increasingly connected world, outward remittances-have become a lifeline for millions. Transfers of money from India to beneficiaries abroad, other than for Nepal and Bhutan, were estimated to have been saturated by 2024 with over 1.3 million Indian students studying abroad and non-resident Indian (NRI) families sending money back home for maintenance or investment.
Outward remittances serve these special purposes, unlike other ones such as investment flows like foreign direct investment (FDI) in which foreign capital funds businesses in India and overseas direct investment (ODI) in which Indian entities expand abroad. These outward remittances and the Foreign Exchange Management Act (FEMA) govern their operation with knots of charges and fees.
In the article, we analyze Outward Remittance Charges and Services Fees of All Indian banks, HDFC, ICICI, Axis, SBI, Federal, BoB, and Kotak, and also suggest some practical means to cut costs.
Why Are Outward Remittances Important?
Outward remittance is extremely important to international financial transactions. Money is sent abroad by individuals and corporations for different purposes, such as the following:
- Education: overing tuition, accommodation, and living expenses for students studying abroad.
- Medical Treatment: payments for surgery, consultations, and any other sort of health services performed abroad.
- Family Maintenance: Support provided by NRIs as well as their family members staying in other countries.
- Business Transactions: Import payments, supplier settlements, and transfer of investments.
- Property & Investment: Purchases of real estates and investments through stock and bonds in a foreign country.
Example: Many Indian students studying in the USA and Canada are dependent on outward remittances for their tuition fees and living costs.
What Are Outward Remittance Charges?
Outward remittance refers to sending money outside the country, for overseas purposes by residents or NRIs, to an overseas recipient in a currency other than Indian rupee. The rates are determined by a number of factors such as the bank concerned, the size of the transaction, the purpose and the form of sending it (e.g. online or offline). Here is the detailed break-up of the components:
- Commission/Transaction Fees: The banks charged either a flat rate (e.g., ₹500) or slab wise tied to the amount. For example: The bigger transfers are subject to a higher percentage or slab based cost.
- Goods and Services Tax (GST): This has quickly added up to all service at 18%.
- Tax Collected at Source (TCS): Under the Liberalized Remittance Scheme (LRS), TCS is applicable above ₹ 10 lakh—Nil for education via loans, 20 percent otherwise (e.g., travel, investments). A medical remittance of ₹ 12 lakh would involve paying ₹ 2 lakh TCS plus other charges, leading to aggregating costs above ₹ 2,01,180 before applying markups for exchange rates.
- Additional Fees:
- SWIFT Charges – Fees required for the SWIFT (Society for Worldwide Financial Telecommunication) network-based transfers.
- Correspondent Bank Fees – Not all such charges are known; they may differ from those imposed by correspondent or beneficiary banks.
- Courier/Postage Charges – In case where physical documentations are required.
- Influencing Factors:
- Bank policies – Each bank has a different fee structure.
- Transaction amount – Higher amounts usually incur higher fees.
- Purpose of remittance – TCS varies with the purpose (education vs gifts).
- Account type – Premium account holders may get discounts.
- Transaction method – Online remittances usually cost less than those directly at a branch.
1. Outward Remittance Charges HDFC Bank
| Transaction Amount | Commission Charges |
| Up to USD 500 (or equiv.) | ₹500 + GST |
| Above USD 500 (or equiv.) | ₹1,000 + GST |
| Additional Fees: SWIFT (varies, often ₹500–₹1,000), exchange rate markup (1–2% above interbank rates). | |
| Insight: HDFC’s premium services cater to high-net-worth clients, but its markups can sting for smaller transfers. | |
2. Outward Remittance Charges ICICI Bank
| Transaction Type | Charges (₹) |
| Branch (Non-USD currencies) | ₹1,000 + GST |
| Branch (USD to USA) | ₹1,500 + GST |
| Online (Non-USD currencies) | ₹750 + GST |
| Online (USD to USA) | ₹1,000 + GST |
| NRO to NRE (within ICICI) | Free |
| Additional Fees: SWIFT (varies). | |
| Insight: ICICI’s online platforms (e.g., iMobile Pay) offer significant savings, ideal for tech-savvy NRIs. | |
3. Outward Remittance Charges Axix Bank
| Account Type | Charges (₹) + GST |
| Savings/Prime | ₹1,000 |
| Priority | ₹500 |
| Burgundy | ₹100 |
| Additional Fees: Commission (0.125%, min ₹125), intermediary fees (₹500–₹1,000). Insight: Axis rewards premium account holders, making it cost-effective for frequent remitters. | |
4. Outward Remittance Charges State Bank of India
| Transaction Type | Charges (₹) |
| NRE/FCNR Account | Free |
| NRO (SWIFT/Wire) | ₹100 + expenses |
| Rupee Remittance | 0.125% (min ₹125) |
| General Charges | |
| Charge Type | Applicable Fees |
| Transfer Charges | ₹1,000–₹5,000 (varies by amount & destination) |
| SWIFT Processing Fees | ₹500–₹2,000 |
| Forex Conversion | 1.5%–3% of amount |
| Insight: SBI’s vast global network often reduces correspondent fees for popular destinations like the UAE or USA, though forex markups remain a key expense. | |
5. Outward Remittance Charges Federal Bank
| Transaction Type | Charges |
| Trade-Related (incl. EEFC*) | 0.125% (min ₹1,000) |
| Non-Trade (LRS/NR Repatriation) | ₹1,000 |
| Non-Trade (Other) | 0.050% (min ₹500) |
| FCNR Repatriation | Full pay charges |
| Additional Fees: SWIFT (₹500), cross-currency fee (₹500), full pay (₹1,200–₹4,500 by currency). *EEFC: Exchange Earners’ Foreign Currency account. Insight: Federal excels for trade-related transfers, appealing to exporters. | |
6. Outward Remittance Charges Bank of Baroda
| Charge Type | Fees (₹) |
| SWIFT Charges | ₹500 + GST |
| Correspondent Bank Fees | ₹500–₹1,500 |
| Additional Fees: Exchange rate markup. Insight: BoB’s public-sector roots keep base fees low, but hidden costs can add up. | |
7. Outward Remittance Charges Kotak Mahindra Bank
| Transaction Method | Processing Fees (₹) | Correspondent Fees (₹) |
| Branch | ₹1,250 + GST | ₹1,000 + GST |
| Online | ₹500 + GST | ₹500 + GST |
| Additional Fees: Exchange rate markup. Insight: Kotak’s online option slashes fees, perfect for smaller transfers. | ||
How to Optimize Costs
Cutting remittance costs requires strategy:
- Compare Rates: State Banks such as SBI may charge comparatively lower base fees, but agencies such as HDFC Bank may have higher markups attached, hence it is advisable to use XE.
- Go Online: ICICI will allow one, while in a situation that includes an online transfer using its services, it saves ₹500-750 compared to branch fees. That is when using Kotak’s net banking.
- Leverage Accounts: For example, Axis Burgundy accounts drop fees to a low of around ₹100, especially useful for frequent senders.
- Batch Transactions: Sending ₹10 lakh at once via SBI might cost ₹5,000 total, compared to over ₹2,000 for two transfers costing less than ₹5 lakh each.
- Explore Alternatives: Outside the bank, third party agencies like Wise or PayPal usually beat bank markups, though FEMA compliance is important.
Disclaimer: The detail under this blog is for informational purposes only and should not be treated to be professional advice on tax, law or finance. While we make reasonable efforts to maintain the precision of the content, Fincirc Consulting India Private Limited makes no guarantees of any kind regarding its authenticity or relevance to particular individuals or business circumstances.
Users are urged to seek advice from an expert in tax or finance prior to acting upon the information presented. In no circumstances shall Fincirc Consulting India Private Limited be liable for any inaccuracies or omissions relating directly or indirectly to the information or for any consequences that arise from the use of the information.
