IDFC Wealth Card Blocked

I had an interesting and unusual experience with my IDFC Wealth card recently. This is my most coveted card with a credit limit in excess of 20 lakhs and is mostly used on overseas trips or when purchasing something from abroad as it provides 2.5% cashback. It also provides domestic and international lounge access.

A couple of months ago, I spent about 2 months in Korea and used it extensively. It was used for tiny Rs50 purchases to larger ones worth several thousand. No issues whatsoever and this has been the same in various other countries. I ended up purchasing Samsung Watch 5 pro and Buds 2 Pro as they were much cheaper in Korea. These were purchased from an official Samsung store in a large mall in Seoul. Now, Korea, like many countries in Europe and Asia, provides a refund of VAT (like GST in India) to foreign tourists. You have to scan the receipt and then swipe your card after you clear security at the airport to show that you are leaving the country. My flight was at night when the manned stations were closed and automated machines were the only option. After about a month, I received the tax refund as a credit on the card in two transactions for the two items purchased. These were small amounts worth Rs 700 and 1500 respectively. I was satisfied and didn't think anything was wrong. However, about 30 days later, my card simply disappeared from the IDFC app. There was a message stating that it was some technical error and they were working on it. So I didn't worry much about it. A few days passed and it still didn't show up. Then I tried netbanking and it wasn't showing there either. So I called customer care and was shocked to hear that my card had been blocked due to RBI instructions! After being transferred to senior rep, I learnt that they had declared these tax refunds from a company called Global Tax Free as prohibited. Despite repeated requests, they were adamant that there was nothing they could do as it was an RBI order. What was worse was that I owed several lakhs on it and I now had no way of knowing the amount due or the due date. They were not even willing to let it be blocked but to at least enable me to see its status on the app. They suggested that I should make the payment via some third party app like Cred!

I explained the situation and offered to share receipts for the transactions. I was asked to email and I sent the purchase receipts, the brochure explaining the tax free programme from the government of Korea and the tax refund receipts that clearly showed the same purchases and the amounts of refund. I received an automated email that they would respond in 24 hours. Several days passed and I did not hear anything. I called customer care and they took requests, I emailed a few times to various email addresses but there was no response and no call back at all! I contacted the branch manager as I am a top tier client and she also emailed the concerned department and yet there was absolutely zero response. Finally, I Tweeted. Now I received a call from their social media team and they again asked me to email and I did so. After a few days, they came up with further requests for more documentation, more emails and so on. Finally, they said that they were going to make an exception by issuing another replacement card but I would have to write a letter expressing regret and promising not to ever engage is similar transactions again. Even though I had done nothing wrong, I was tired of repeatedly explaining it and them not understanding it and I sent the required email. They followed up by asking for a hand written and signed letter to be sent via scan! Finally, after about 2 weeks, a replacement card was issued and a fee of Rs99 charged for it!

I believe their system flagged these transactions as income from international gambling or some other restricted activity. Has anyone else faced a similar issue?