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1. Carry a mix of foreign currency, traveler’s checks, credit cards and ATM cards. While all of these are accepted in India, at any given location you may only be able to use some of these options. Carry your foreign cash and checks in major international currencies, such as the US dollar, Euro or UK pounds, as these are more widely accepted than other currencies.
2. Change some money at your arrival airport in India, in order to have some cash on hand for immediate expenses, such as cab fares and meals. As the exchange is likely to be less favorable inside the airport, do not change large sums of money. Similarly, some hotels will exchange currency, but the rate may not be favorable.
3. Use your ATM card to withdraw cash at ATMs which are widespread in the bigger Indian cities and towns. You could get a more favorable exchange rate than at a currency exchange counter this way, but be aware that there are likely to be additional fees for using the ATM of a bank different from the one that issued your card. If possible, maintain a bank account at a major international bank like Citibank and HSBC, which have branches in India. This could reduce or eliminate your ATM fees if you withdraw cash from their Indian branches. You can also keep ATM fees down by withdrawing larger sums of money each time, thus reducing the number of times you need to withdraw cash.
4. Exchange money or travelers checks at authorized money changers’ counters in the bigger cities. Shop around to find the best exchange rate (often several money changers are located close to one another, making it easy to compare their rates). When you get the money, count it carefully to make sure you received the right amount, and ask for most of it in small bills (500 rupees or smaller) as it is hard to use larger bills at most businesses. Also check that the bills are in relatively good condition (not excessively frayed or stained), as Indian merchants are reluctant to accept currency in poor condition.
5. Exchange foreign currency at banks like the State Bank of India or the Reserve Bank of India in places where private money changers may not be present (as in the smaller towns). The banks sometimes offer a worse exchange rate than the private money changers, so it is better to change money in the bigger cities before you venture out to more remote locations.