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If the merchant says that the Forex Prepaid card is not working, what is to be done?

Ask the merchant to ensure that he has swiped on a Credit Card terminal. Machine should accept VISA/MasterCard flag cards.
If the card is still getting declined, walk into the nearest ATM to check the available balance on the card. Customers can withdraw the cash from the ATM and settle with the merchant. Report the matter to ICICI Bank, for follow up with the Merchant.