On arrival at the airport in India, foreigners may exchange currency at the currency exchange booths located inside the airport. These booths are usually available before you leave the customs area. If you walk out of the airport you may not be allowed back in to exchange foreign currency.

Some points to remember when exchanging currency in India.

Always exchange foreign currency at authorized dealers such as American express or Thomas cook outlets. Most banks also are authorized to deal in foreign exchange.

Insist on a currency exchange receipt. This proves the source of your funds in India.

Currency exchange receipts clearly show the amount of foreign currency exchanged for Indian currency and the rate of exchange you were given.

Please be aware that fake Indian currency notes like Rupee 500 notes are said to be circulating in India. This is another reason it makes sense to get your currency from banks.

Do not fall victim to people trying to entice you by saying they will give you a better exchange rate than what the banks may offer you.

If you save your currency exchange receipt you will be able to reconvert your left over Indian currency back to foreign currency at the airport where you fly out from.

When buying rail tickets etc that are available on a priority basis for tourists only. If you have proof of currency exchange receipt you will be allowed to pay for the tickets in Indian rupees. Other wise you will have to pay in foreign currency only.

Do not purchase foreign currency form local residents. Buying foreign currency from unauthorized places is also illegal. Fake foreign currency is not uncommon in tourist areas.

Many banks and money exchange dealers offer a slight premium for traveler’s cheques than they do for cash.

When paying by an international credit card save your invoices. I prefer to write Indian Rupees also where the amount is filled on the invoice before signing it.

Do not buy anything online when using a computer in a cyber café.

Use only a secure computer when logging on to do your banking.

Complete details on India's Foreign Currency rules and regulations are provided in a question answer format at nriinformation.com.

A foreigner can bring in any amount of foreign currency, travelers cheques, etc., and take out as much as he brought in. However if carrying foreign exchange in excess of US$ 5000 or its equivalent in another currency, US$ 10,000 in the form of travelers cheques, or a combination of currency and travelers cheques in excess of US$ 10,000 you must declare it on arrival on the Currency Declaration Form (CDF), to be attested by the Customs Officer.

Indian currency is the Indian Rupee/Rupees (Re/Rs). It is not possible to purchase these before you leave your country. If you want cash on arrival it is best to get it at the airport bank. Rupee notes are printed in the denomination of Rupees 1000, 500, 100, 50, 20, 10 and 5. Coins are minted in denominations of Rupees 5, 2, 1, and paise 50 and 25. Indian currency conversion rules are much more relaxed than a decade ago. However it is recommended that visitors carry travelers cheques of reputed companies such as Thomas cook, American Express etc. They have to almost always be exchanged in banks or hotels, and are not easily accepted for direct payment unless accompanied by a passport. Credit cards are increasingly acceptable in the main centers though in smaller cities it is still rare to pay by credit card. There are several ATMs in several major towns, but several of these are for local account holders. Here again reputed companies such as Visa, Master, and Cirrus are becoming increasingly acceptable. Changing money through unauthorized dealers is illegal. Most large government banks in India such as State Bank of India, Bank of Baroda have foreign exchange counters and give cash against Visa/Master cards. Bank rates and hotel rates do not vary much, but always retain the encashment certificate when you change money through authorized dealers. Telegraphic transfers are possible through international banks such as American Express, HKB, Barclays, ABN AMRO and Standard Chartered bank but transfer fee up to $30 may be charged.