Home / Business and Economy / Card Fees Soar: Banks Hike DCC Charges Significantly
Card Fees Soar: Banks Hike DCC Charges Significantly
30 Jul
Summary
- Axis Bank credit card DCC fees rise to 3.5% on August 28, 2026.
- Kotak Mahindra debit card DCC fees increase to 3.5% plus GST on August 1.
- Fee hikes may cover processing costs and capture rising overseas payment volumes.
Axis Bank and Kotak Mahindra Bank are implementing substantial increases in their dynamic currency conversion (DCC) fees. Starting August 28, 2026, Axis Bank will raise its credit card DCC fee from 1.5% to 3.5% for most card types. Kotak Mahindra Bank's debit card DCC fee will also increase significantly.
Effective August 1, Kotak Mahindra Bank will raise its debit card DCC fee to 3.5% plus GST, up from the previous 1% plus GST. These revisions bring the DCC charges closer to the typical 3.5% foreign-currency markup applied to standard credit cards.
While banks have not publicly stated reasons, these changes are expected to help offset card-network and cross-border processing expenses. They also aim to generate additional fee income from the growing volume of international transactions, including online purchases and payments to overseas-registered digital merchants.
Experts suggest that higher DCC charges ensure similar economic outcomes regardless of whether a customer opts for rupee billing or payment in the merchant's local currency. This change removes any pricing advantage previously associated with paying in rupees through DCC.
