DMC says the wire arrived short: OUR, SHA and the bank spread

If you book net rates with an overseas DMC, you've had this call: you wire USD 10,400 for a land package, and the DMC says the payment kam pahuncha, a few tens of dollars short. The wire went SHA, and banks along the route, possibly including the DMC's own, took their fees out of it before it was credited.

OUR shifts most of that onto you, but it doesn't fix the bigger cost one line above it: the gap between your bank's conversion rate and the RBI reference rate, which on a ₹10 lakh payment usually outweighs every fee and tax combined. This post costs a remittance three ways, sets out the GST slabs, and gives one sentence for your DMC agreement so a shortfall never holds up vouchers.

Why the DMC got less than you sent

Check which charge code went on the wire. If nobody chose one, the bank's form or app default applied, and defaults differ: one bank collects OUR charges upfront on every transfer through its retail app.

Under SHA (shared charges), you pay your own bank's fee, while any correspondent bank the SWIFT message passes through, and the DMC's own bank, can take their fees out of the amount before it is credited; that bank's FAQ says correspondent banks levy charges at their own discretion (see the FAQ). There's no fixed deduction: one explainer's illustration has two correspondent banks each taking roughly USD 20 off a USD 10,000 transfer, illustrative, not a tariff (Skydo, 15 Sep 2026). The DMC may then hold vouchers until a second wire covers the gap, and that wire carries its own fees.

Sending the payment itself (Form A2, FEMA declaration, purpose code) is covered in paying your foreign DMCs legally. This post only costs what it takes out of your pocket.

OUR, SHA and BEN: who actually pays

Three charge codes decide who the banks bill:

Code	Who pays the banks	What can still go wrong
OUR	You pay your bank's and correspondent charges	The DMC's own bank may still deduct its fee
SHA	You pay your bank; the DMC bears the rest	Correspondent and DMC banks can deduct before crediting
BEN	The DMC bears the banks' charges	The DMC receives the least of the three

Careful: OUR doesn't guarantee every rupee lands. A bank's own page says its retail OUR product covers its own and correspondent charges, but "does not include the charges levied by the beneficiary bank or beneficiary bank's intermediary."

The real cost is the rate, not the fee

As at 1 pm on 16 October 2026, RBI's home page, sourced from FBIL, showed the dollar reference at ₹95.0194. Your bank's TT selling rate sits above that; one explainer puts banks' markup at 1% to 4%, depending on the currency pair and amount (Razorpay, 26 Mar 2026). On a USD 10,400 payment, a 1.5% margin alone is worth over ₹14,000, before any fee.

That's different from the rupee moving between your quote date and payment date, covered in forex buffers for outbound quotes. This post is only about what your bank keeps on the conversion itself.

A USD 10,400 payment, three ways

Run the same DMC invoice three ways. Reference value: ₹9,88,202. The rest is a labelled assumption, not any bank's price: card rate = reference +1.5% (₹96.4447); negotiated rate = reference +0.25% (₹95.2569); wire fee = ₹885 incl. GST; OUR charge ≈ USD 30 (USD 25-50 range reported); SHA deductions ≈ USD 35 (USD 20 at a correspondent, USD 15 at the DMC's bank). Conversion GST uses the Rule 32(2)(b) slabs below.

Route	What happens	Rupees debited	Over reference
A: SHA, then a top-up	DMC short ~USD 35; a second wire tops it up	₹10,12,099	₹23,897 (2.42%)
B: OUR at the card rate	Correspondent charges covered; beneficiary fee may still apply	₹10,07,794	₹19,592 (1.98%)
C: OUR at a negotiated rate	Same cover, rate near reference	₹9,95,396	₹7,194 (0.73%)

Of route A's ₹23,897 overage, about ₹14,823 (62%) is the rate spread, ₹7,199 is the top-up wire, and the rest is fees and GST. Route C saves roughly ₹16,700 against route A, almost all from the rate.

GST on the conversion, done right

GST on a conversion isn't charged on the amount remitted; it's charged on a "value" set by CGST Rule 32(2). Clause (a) makes that value the actual spread over the RBI reference rate. A bank can instead opt, for a whole financial year, for the clause (b) slabs below, where each percentage applies only to the part above its threshold, not the whole payment.

Payment value	Taxable value (Rule 32(2)(b))	GST at 18%
Up to ₹1,00,000	1% of the amount, min ₹250	₹45 to ₹180
₹1,00,001-10,00,000	₹1,000 + 0.5% above ₹1,00,000	up to ₹990 at ₹10 lakh
Above ₹10,00,000	₹5,500 + 0.1% above ₹10,00,000, capped at ₹60,000	up to ₹1,170 at ₹20 lakh, capped ₹10,800

A bank's published slab table confirms this reading (slab-wise structure), and the worked example uses it. If your bank values on clause (a) instead, the GST is 18% of the spread: about ₹2,668 on route A's main wire, not ₹991. Ask your bank which method it uses.

A 5% tour-operator invoice can't claim this as ITC, since that rate allows no ITC except on another tour operator's services (ClearTax); an 18% service-fee invoice generally can. Either way, ask for the bank's monthly consolidated GST invoice or statement carrying your GSTIN: CGST Rule 54(2) lets a bank issue one document for the month's services instead of an invoice per transaction, so a debit advice alone may not be what your accountant needs for the ITC claim.

Asking for a better rate

Ask for the remittance quoted as a margin over the FBIL/interbank reference, not a flat card rate, and for the bank's schedule of charges and any cross-border remittance policy it has. One bank's 2026 policy says FEDAI advised authorised dealers in April 2026 to frame internal guidelines on transparency, and it sets out charges, processing timelines and an escalation matrix (example). Fees vary by product and tier too: one bank's wholesale trade tariff charges 0.25% flat (minimum ₹500) on outward remittances other than import payments (tariff), while its 2024 schedule for trade-focused current accounts makes per-wire and SWIFT fees free on the higher tier (schedule). Also ask whether your current account can be linked to FX-Retail, the platform RBI rolled out through CCIL for buying foreign exchange for remittances.

Subject: Rate and charges for outward remittance USD [amount] on [date]

Please quote your TT selling rate for USD [amount] to [beneficiary
bank/country], value [date], as a margin over the FBIL reference
rate, with the all-in OUR charges (fee, SWIFT, correspondent, GST).
Please also share your schedule of charges and cross-border
remittance policy, and confirm if our account can link to FX-Retail.

Pay in the DMC's currency, and batch by departure

Pay in the currency the DMC's account is held in. USD to a USD account converts once, at your bank; USD to a THB account converts again at theirs, on a rate you never see. RBI's reference page covers USD, EUR, GBP, JPY, AED and IDR (Dubai, Europe, Bali), but not THB or GEL, so benchmark those through USD.

Where the DMC's terms allow, pay once per departure, not in instalments: the GST slab and the wire fee apply per transaction, not per rupee. At the fees assumed above, four ₹2.5 lakh deposits to the same DMC cost ₹4,800 in fees and conversion GST combined; one ₹10 lakh payment costs ₹1,875, before any OUR charge.

Put the charges in the agreement, and watch this fraud pattern

Put the charge code and shortfall rule in writing before the first payment:

Payments to you will be sent by SWIFT with charges code OUR, so our
bank's and intermediary banks' charges are for our account and charges
levied by your own bank are for your account; any shortfall of up to
USD 50 caused by bank charges will be settled against the next invoice
or the final account for this group and will not delay confirmations
or vouchers.

One warning worth repeating every season: a request to pay a shortfall to a different account than the original invoice's is a known fraud pattern, not a billing hiccup; confirm it by phone on a number you already hold. A top-up still goes through your authorised dealer bank, since residents can transact forex only through authorised persons, for permitted purposes (RBI FAQ).

When the money comes back: the refund leg

Tell the DMC how to send a refund before they send it: OUR, in the original currency, quoting your invoice and remittance reference. Cash or a credit note is covered in the Gulf-route disruption playbook; this post only covers how the money travels back.

Your bank will usually ask for an inward "disposal instruction" naming a purpose code. One bank's inward checklist uses P1502, "reversal of wrong entries, refunds of amount remitted for non-imports," with your confirmation of the transaction and the reason (checklist). That's one bank's own process, not a universal RBI code; confirm it first.

Please return USD [amount] by SWIFT, charges OUR, in USD, to
[account], quoting invoice [no.] and remittance reference [UETR/ref],
stating "refund of amount paid for [group/dates], cancelled".

The round trip costs money even when nothing goes wrong. An illustrative USD 4,000 refund bought back 1.5% below an unchanged reference, less conversion GST and an assumed ₹1,000 inward fee plus GST, nets about 3.4% less than the card-rate rupees you paid for that USD 4,000, from the two spreads and the fees alone.

Booking it so the departure shows the real cost

Book the DMC payment at the rupee amount actually paid. Entry 12 in the accounting-entries guide sends the gap against the invoice-date rate to Forex Gain/Loss; give the bank's fees their own bank-charges line, and post the GST on fees and conversion to input credit if you bill an 18% fee, or to cost under a 5% package. One note on paperwork: the Income-tax Act 2025 applies from 1 April 2026, Form 145 and Form 146 replace Form 15CA and 15CB (reported here), and one bank's 2026 policy lists both for a business's outward services payment. Confirm what your remittance needs with your CA.

Common questions

OUR, SHA aur BEN mein kya fark hai?

OUR means you pay your bank's and correspondent charges, so the DMC is meant to get the full amount, though its own bank's fee can still apply. SHA splits charges between you and the DMC. BEN puts every charge on the DMC.

DMC ko payment kam kyun pahunchta hai, jab maine pura amount bheja tha?

Usually because the wire went SHA, not OUR: the payment crosses correspondent banks and reaches the DMC's own bank, and each can deduct a fee before crediting it. Send any top-up as its own OUR wire.

Does paying OUR guarantee the DMC gets every rupee?

No. A bank's own page says its retail OUR product covers its own and correspondent charges, but excludes the beneficiary bank's own charges.

What purpose code does a DMC refund use coming back into India?

One bank's inward checklist uses P1502 for a refund of an amount remitted for non-imports, with a disposal instruction and your confirmation of the transaction and the reason. That's one bank's own process, not a universal RBI code; confirm it with your bank first.

The short version

• Under SHA, correspondent banks and the DMC's own bank can deduct fees; OUR shifts your bank's and correspondent charges to you, but the DMC's own bank can still deduct its fee.
• The biggest cost is usually the rate spread over the RBI/FBIL reference, not any fee: ask for a margin over reference, not a card rate.
• On a USD 10,400 example, OUR at a negotiated rate saved about ₹16,700 against SHA-plus-top-up, almost all from the rate.
• On the Rule 32(2)(b) slabs, conversion GST is ₹990 on ₹10 lakh and never above ₹10,800 (ask if your bank uses them); a cost under a 5% package, usually an ITC under an 18% fee.
• Pay in the DMC's actual account currency, and pay once per departure where the DMC allows: the wire fee and GST slab apply per transaction, not per rupee.
• Put the OUR/shortfall line in the DMC agreement, and never send a top-up to an account different from the invoice.
• A refund wire loses money on the spread and fees again; ask the DMC to send it OUR, in the original currency, against your invoice.