Bank makes a 'smuggler' of Kiwi on holiday

RICHARD MEADOWS
Last updated 05:00 13/01/2014

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A Kiwi on an intrepid journey to India unintentionally ended up 'smuggling' currency into the country, thanks to Kiwibank.

In May last year, Indian authorities introduced new laws strictly prohibiting foreign travellers from importing rupees.

Only Indian residents are allowed to do so, and even then only in small quantities of less than 7500 rupees (NZ$150).

New Zealand banks - including the local branch of the Indian Bank of Baroda - have since stopped offering physical cash rupees, which are effectively useless.

The exception appears to be the state-owned Kiwibank, which sold a traveller 20,000 rupees (worth roughly NZ$400) last week.

Jason - whose name has been changed - has just set off on a one-month holiday around the subcontinent.

When his travelling companion tried to buy some rupees of her own at an airport foreign exchange desk, a clerk told the pair it was illegal to import them.

But that was too late for Jason, who had split the Kiwibank-issued cash between his suitcase and carry-on luggage for safekeeping.

"I'd already checked in the first bag when I found out," he said.

"It's one of the currencies they [Kiwibank] actually keep and trade, but they don't warn anybody against it."

Importing rupees is treated as a criminal offence, with penalties ranging from confiscation of the money, to arrest and prosecution.

However, travellers' forums online suggest enforcement of the new laws are patchy.

While somewhat annoyed about not being told, Jason said he was not overly concerned about being caught.

"I think we should be all right," he said.

In the wake of the inquiries by Fairfax, Kiwibank has immediately instructed its network to stop providing Indian currency.

"It is clear we have put a customer in the situation where they could have had money seized by Indian customs or worse, action taken against them," said communications manager Bruce Thompson.

He said Indian rupees were not a commonly requested currency, but any exchanges should only have been made with the appropriate warning, or confirmation of the nationality of the customer's passport.

"We are now considering whether to permanently remove the currency from the exchange options or to have more vigorous control on how it is issued," Thompson said. 

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- BusinessDay.co.nz

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