Axis Bank and Kotak Mahindra Bank Set to Hike Overseas Card Transaction Charges from August 2026

Axis Bank and Kotak Mahindra Bank are set to raise the charges for dynamic currency conversion on their credit and debit cards in August 2026, as per The Economic Times news report.  

This update comes as both banks adjust their fee structures in response to evolving market dynamics. 

Changes in Dynamic Currency Conversion Charges 

Effective August 28, 2026, Axis Bank will increase the dynamic currency conversion (DCC) fee on its credit cards to 3.5% from a previous rate of 1.5%.  

Kotak Mahindra Bank, meanwhile, is set to elevate the fee on debit card transactions to 3.5% plus goods and services tax (GST), from an earlier 1% plus GST, starting August 1, 2026. 

The increase in DCC fees brings Axis Bank's charges for MyZone, Select, Privilege, and Neo credit cards to 3.5%. However, the charge on Magnus and Magnus for Burgundy cards will only rise to 2% and 1.8% for Olympus cardholders. 

Context Behind the Fee Increase 

The changes align the DCC charges closer to the foreign-currency markup of approximately 3.5% imposed on most standard cards.  

This adjustment is reportedly aimed at recovering card-network and cross-border processing costs, while potentially increasing fee income amid rising volumes of overseas transactions and international e-commerce. 

Under dynamic currency conversion, when customers opt to pay in rupees, the exchange rate is usually determined by the merchant or payment processor. Therefore, the banks levy the DCC fee and GST over this rate, providing a unified economic structure for payment options. 

Read More: Banks Collected Over ₹26,170 Crore in Minimum Balance Penalties in 4 Years: Government Data! 

Conclusion 

Axis Bank's DCC fee for certain credit cards will increase to 3.5% from 1.5% by August 28, 2026, whereas Kotak Mahindra Bank will raise its fee to 3.5% plus GST from 1% plus GST starting August 1, 2026. ICICI Bank had previously increased charges in June 2026. 

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