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Money

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Information on using money is covered in the Buy section of destination guides. This article contains general information useful in many destinations.

There are a number of ways to obtain and exchange money while traveling. You are always trading off expense, risk, and convenience.

Debit and credit ards

Debit and credit cards can be used to withdraw cash from automatic teller machines (ATMs) and to make purchases at stores, restaurants, and hotels where they are accepted.

Acceptance of debit and credit cards at point of sale

The acceptance of debit and credit cards varies by country, with acceptance being more common in more developed countries. Acceptance of credit and debit cards may be close to nonexistent in less-developed countries. Check the country guides for details on credit card acceptance.

The most accepted cards by far worldwide are VISA and MasterCard. American Express and Diners Club cards have global networks but acceptance varies widely depending by country and store type. Discover, JCB, NYCE, Star, MAC, and Shazam are regional. They are rarely accepted outside of the region they are issued in, and, even then, acceptance is often limited to areas catering to visitors from that region.

Acceptance of debit and credit cards at ATMs

Mastercard, VISA, Cirrus, and Plus are accepted at nearly all ATMs worldwide.

Some developing countries either have no ATMs, very limited ATMs, or are not connected to the international networks. This includes Myanmar in Southeast Asia, as well as parts of Africa. In Japan, most bank ATMs don't work with international cards (the cards are even an incompatible size), and you need to look for a post office, 7/11 or Citibank ATM. In certain countries, not every ATM accepts foreign credit or debit cards.

Generally, only the main bank account linked to a debit card can be accessed at ATMs outside of your home country.

Debit cards compared to credit cards

Debit cards are linked directly to a bank account and immediately deduct the amount of the purchase or withdrawal from the account. Credit cards are cards that are not linked to a bank account, but that instead charge against a credit line, which must be repaid at a later date. If the charges are not repaid before the end of a grace period (usually 0-25 days), interest will be charged.

If you withdraw from an ATM using a credit card (as opposed to a debit card), you will typilcally be charged foreign transaction fees as well as a cash advance fee (usually 2%-3%) and charged interest on your cash advance starting on the day you pull money from an ATM, unless you have a credit balance on your account.

Still, when making point-of-sale purchases, notwithstanding the fees, it is usually better to use a credit card than a debit card, since if your card is stolen you can easily dispute the charges on a credit card, while a stolen debit card may lead to an overdrawn bank account requiring many additional hassles. Credit card companies will also protect you if you are charged more than you agreed to pay, if you pay for something and never receive it, or if your card is cloned (duplicated) without your knowledge and then used for fraud without being physically stolen.

Credit cards also may include other benefits such as cancellation insurance for flights (usually only in the case of serious sickness), theft or loss insurance for goods (usually only if stolen within 90 days of purchase and a proper police report is filed), collision insurance for rental cars, and emergency health insurance in certain situations while you are travelling.

Credit cards may provide rewards programs that give you free flights or cash back after a certain amount of spending. The cards may be linked to a frequent flyer program.

If you have an American Express card, in case of a lost or stolen card, you can obtain cash advances and replacement cards easily, by visiting and American Express Office.

Considerations when travelling with debit and credit Cards

  • It is a good idea to carry multiple debit and credit cards from multiple banks and issuers just in case one is lost or stolen or doesn't work at a specific ATM. Also, it is a good idea to carry around only the card you will usually be using and keep the backup cards in a safe location where you are staying to give you a backup card so that at least card will remain if anything happens.
  • You may have to get international ATM support specifically activated for your debit or credit card. In addition, some banks will stop your card if they notice sudden transactions in a foreign country. It is best to notify the bank beforehand and get a note added to your account so it does not get passed through their fraud section.
  • Be sure you know the PIN for each of your debit and credit cards in case of an emergency. Many people are not able to access cash using their card because they forget the PIN code. PIN code lengths vary from country to country, but up to six digits are usually accepted anywhere on the Plus/Cirrus networks. If you have a six-digit PIN and six digits don't work, try entering just the first four numbers of your PIN, or find another ATM. If the ATM requires 6 digits and you have only 4 digits in your PIN, try entering 00 as the last two digits. If your PIN is based "word based" know its numeric equivalent. Many ATMs outside the USA have no letters to correspond with the numbers. (example: "CASH" = 2274) Change your PIN before departure if it will make your PIN digits easier to remember.
  • In most countries, you are not responsible for any expenses made on your debit and credit card that occur after you report it lost or stolen.
  • In case of an emergency, you can use Western Union to wire yourself some money using your debit or credit card (if you know the numbers). However, exorbitant fees will apply.
  • Many credit cards issued in Western Europe feature a chip and PIN system, where credit cards all have a chip built in and you have to type your PIN code into a reader instead of signing a receipt. All stores that display the VISA, MasterCard, or American Express logos must also accept the sign-and-swipe version of the credit cards; however, some may initially refuse to do so (be persistent, askinng for the manager if necessary). Note, however, that with self-service vendors such gas pumps and ticket vending machines, you may be out of luck.

Additional considerations regarding fees

  • If you are staying for a long time in a single country, you may save on fees by opening a local bank account and obtaining a local ATM card. You will usually need a local mailing address and may need a valid residence permit.
  • Most credit card companies will charge a foreign transaction fee 2-4% of the transaction amount every time you make a purchase abroad. Some issuers offer credit cards that do not charge the customer any foreign transaction fees [1]. It may be worth applying for a no-foreign-transaction-fee credit card at least three weeks before you leave for your trip.
  • When making point-of-sale purchases, most US-issued VISA/MasterCard debit cards can be used only in "credit" mode (swipe-and-sign, as opposed to PIN-based "debit" mode). In addition, if you are faced with a situation where a PIN is required (such as certain unmanned train ticket kiosks in Europe), it is certainly better to use a debit card than a credit card, as PIN-based transactions with a US credit card may incur cash advance fees (in addition to any foreign exchange fees).
  • The exchange rate applied may be the rate on the date the expense was posted to the account, not the date the charge was made. Therefore, if you are dealing with a fluctuating currency it is impossible to know exactly what exchange rate will be applied for an expense until a few days after you make the expense. In general, VISA/MasterCard cards seem to get slightly better exchange rates than American Express, although the difference is very small.
  • When you are paying by VISA or MasterCard, some merchants will offer to convert your transaction into your home currency ("'Dynamic Currency Conversion'"). If this offered, you should decline it, as an exorbitant exchange rate of 7% may be charged [2]. Always check your receipt, and if you see anything involving your home currency in a country that doesn't use that currency, ask the merchant to redo the transaction in the local currency. If the merchant insists that the conversion is automatic, it is worth arguing or reporting the incident to your credit card company. VISA requires the merchant to disclose the fee and must provide the consumer with a choice of getting the bill in the customer's home currency or the local currency.

Traveller's cheques

A traveller's cheque is a cheque issued for a fixed amount in a specific currency that you purchase with your funds in advance. Be sure to get the cheques in the currency of the country to which you are travelling. Traveller's cheques are available only in major currencies. For example, if you are in travelling to the USA, you could purchase ten US$100 traveller's cheques before you travel there, and use them when you arrive. You sign each cheque when you purchase it and again on the same cheque to redeem it.

The main advantage of traveller's cheques is complete protection against loss or theft. Once you report them as missing, the issuing company will replace them. You must also keep a record of your used cheque numbers. Most traveller's cheque issuers have arrangements to replace them around the world in a short time frame so you are not long left without cash. If you are unsure which cheques you have already cashed and which are missing, your refund may be delayed until the issuer can figure out which ones have been presented.

Traveller's cheques can be exchanged for cash at most banks. Exchange bureaus will also usually cash them, and a hotel may sometimes provide this service to its guests. American Express traveller's cheques can also be exchanged at American Express travel centres. Fees for cashing traveller's cheques vary by destination and institution. Some banks will cash some brands of cheques free. American Express will cash their cheques free at their travel centres if they are in the denominated in local currency. Often, fees apply, a sliding scale or a flat fee that may apply only above a certain threshold. If you are cashing traveller's cheques into different currency to their denomination, fees may also be built into the exchange rate.

Traveller's cheques can also sometimes be used for purchases at point of sale, although less widely than credit cards. In general, only the largest stores and hotels will accept traveller's cheques for payment.

You will pay a fee to buy traveller's cheques. If they are denominated in a foreign currency, this fee may be built into the exchange rate.

If you are buying traveller's cheques in a foreign currency, you lock in the exchange rate on the day you purchase the cheques. Buying traveller's cheques prior to travel in small increments can sometimes have the effect of averaging out the exchange rate you obtain, and you don't have the risk involved in keeping foreign currency cash for extended periods.

If you have travel insurance, you may care to compare the benefits under your policy. Credit card companies will usually offer a 48-hour emergency replacement or cash advance service for a fee, and these fees may already be covered under your policy.

When you are visiting a developed country where your credit or debit card works, these electronic forms of payment are almost always better than traveller's cheques. You won't have to find a bank or merchant that accepts the cheques (and bankers' hours are often inconvenient), and you won't have to guess in advance how much money you will need. This avoids unnecessary fees if you guess too high and running out of money if you guess too low.

Cash

Clockwise from top left: South Korean won, American Express traveller's check (US dollar), Indonesian rupiah, Brunei dollar, Zambian kwacha, Malaysian ringgit, Malawi kwacha, Chinese yuan, Cambodian riel

Cash is the most versatile method there is. Aside from some car rentals, airlines (while onboard), and a few gas stations, virtually everybody takes cash.

In some countries, you may be able to get by entirely with U.S. dollars or another major currency. However, this will often be at an additional expense as the exchange rate offered by merchants and hotels can be not very good. Merchants in border communities may accept currency of neighboring currencies. For example, northern border areas in the United States may accept Canadian coins on par with corresponding U.S. coins but not Canadian dollars, and, in the U.S. South, a Canadian quarter is usually worthless.

For remote travel, be sure to bring notes from your own currency only in good condition and only the most recent redesign (unless it's really new). Banks at your destination cannot easily or cheaply exchange worn-out currency for replacement as they can with their country's own currency. Worn paper currency may be devalued--if it is accepted at all. Even if in good condition, previous designs of your currency may not be accepted due to counterfeiting concerns. If possible, go to your bank early in the day, and well before the departure date, and ask for "like-new" currency.

This biggest disadvantage to cash is the risk. If you lose it, you can't get it back, and, if someone finds out you have a large wad of cash, you become a potential mark. Some defences are discussed in the pickpockets article, but there is no complete defence — carrying cash always involves a risk. Travel insurance may cover a theft of cash to a certain value.

When you use local money, familiarize yourself with the basic note designs and their security features (watermarks, holograms, etc), and watch out for counterfeits and obsolete currencies. Banks and money changers (operating out of an office, not flashing wads of cash from a coat pocket) are nearly always safe, but taxi drivers, and petty traders may be tempted to palm off useless notes. When in doubt, reject unfamiliar notes. Also, be particularly suspicious of large notes, mre commonly fake.

Where to get or exchange cash

All money exchanges work on the basis of selling a foreign currency at one rate and buying at another. Make sure that you know the current interbank exchange rate before you leave home [3]. Where there is more competition, the rates are likely to be better. In some cases it may be better to exchange your money before you leave, in others it may be better to do it in your destination. The most convenient location (such as at airports, or major hotels) can be the worst rates available. In many developed countries, the best option (given the convenience and typically good exchange rate) is to use an ATM in the destination country instead of than bringing large amounts of cash to exchange. As there are fees associated with currency exchange you should not exchange more than you need, though if you are using a foreign ATM, per-transaction fees may make it advantageous to do a small number of large transactions.

Most major currencies are subject to counterfeiting these days. Study the notes of the currency of the foreign country to become familiar with how it is supposed to look and feel. Almost all currencies employ anti-counterfeiting technologies, including colour shifting ink, watermarks, special threads, iridescent inks, raised printing, holograms and other features. Be familiar with them so that you can quickly check them when you get a new nore whether it is as change or from a money exchange. If you are unsure, don't be afraid to say that you would rather get a different note or say you would rather get two smaller notes for change. (For example, if you get a 10 in change that you don't like the look of, ask for two 5s instead). If you end up with a counterfeit, you won't get compensated, and you may end up having explainomg with the police.

Convertible currency

A convertible currency is a currency that can be easily converted into another country's currency; conversely, an inconvertible currency is theoretically worthless outside its country of origin. A few countries, like Cuba, still issue one convertible currency for tourists and one inconvertible currency for locals. In some countries like Tunisia and India, importing or exporting (inconvertible) dinars and rupees is technically a crime, although such regulations are rarely enforced for small amounts. Still, find out the laws beforehand and follow them.

Convertibility is set by law and not always entirely reflected in reality: some currencies like the Indian rupee are inconvertible in theory but fairly easy to trade in practice, while others like the Swazi lilangeni are fully convertible in theory but almost impossible to sell or buy in most of the world.

Despite the name, inconvertible currencies can often be purchased at a discount outside the country of origin as people holding onto them want to get rid of them. Finding somebody to buy them is more difficult. Also note that state-run shops in some countries will also insist that tourists produce certificates of exchange to prove that their money was obtained from a legitimate source like a local bank at the official (usually poor) exchange rate, and such certificates are also often required if you want to change back any unneeded money within the country.

If travelling to a country with an inconvertible currency or one that you can't, in practice, buy or sell in your home country, you should convert all your money to a major international currency before leaving the country. In general, these currencies can be exchanged at banks anywhere in the world: U.S. dollar, euro, British pound, Japanese yen, Swiss franc, Australian dollar, and Canadian dollar.

Hard currency

In many poorer countries with inflationary, unstable, and/or inconvertible currencies, a foreign hard currency may prove more useful than the local currency. Although its value fluctuates, the "gold standard" for currencies remains the U.S. dollar. It may be accepted as payment directly by locals, though not necessarily at a good exchange rate. In fact several countries in the Caribbean, the Americas and Southeast Asia use it as their de facto – or even official – currency. The euro is also increasingly well accepted, at least in regions with many European visitors, and small countries with economically powerful neighbours may also accept regional hard currencies (such as the Thai baht in Laos and Cambodia, the Australian dollar, or sometimes the New Zealand dollar in much of Oceania).

You can use hard currency when haggling with locals by offering hard instead of local currency. Use the conversion rate to your advantage and make an offer in hard currency. Showing a few U.S. dollars in the process might help but be sure to show only what you are willing to pay. Also, if you plan on haggling, be sure to have small notes available so you don't need much change back, especially if you just haggled a price much lower. You don't want to be giving a vendor 50 for an item worth 5; you'll be inviting the vendor to try to sell you more things or, even worse, let nearby pickpockets know how much you have.

It is wise to carry an emergency stash of hard currency separated from all your other belongings and valuables. Some businesses that deal with a large number of foreign tourists may also accept foreign money but almost always at an inferior exchange rate to allow for the inconvenience.

Black market exchange

In some countries the official exchange rate is fixed at a completely unreasonable or unrealistic rate. In these countries the black market will provide much more realistic evaluation of the currency's worth and is practically unavoidable. For example, in 2007, the official exchange rate was 250 Zimbabwe dollars to the US dollar, while the black market rate reached 600,000.

That said, the risks of black market exchange are legion. First and foremost, black market exchange is illegal and both buyer and seller may face severe sanctions if caught: the seller may even be (or work with) a police officer out to trap tourists. Second, the risk of fraud is high: you may get obsolete banknotes, fake banknotes, less than the promised amount or nothing at all. Consider carefully whether you need to exchange in the first place, as businesses in countries with basketcase currencies will often be more than happy to accept hard currency directly instead (although this, too, will often be illegal), and you may get all thelocal currency you need back as change.

Change only a bit at one place and the rest elsewhere so that if you are scammed, it will be less of a loss.

The key guideline to successful black market transactions is to receive the money before you hand yours over. Count the notes, inspect the notes carefully, compare them to any you already have, and, only then, surrender your own money to the vendor. Do not allow them to take back the money they gave you, as this is where various sleight-of-hand tricks can be pulled to replace the legitimate bundle with something entirely different.

In countries where foreign exchange rates are reasonable, it is best to avoid the black market entirely: you risk losing all your money for little gain at most.

An exception may apply in countries such as Nepal and India where doing a legal exchange at a bank can involve wasting an hour or more but most hotels will change money for you instantly and fairly safely. The rate may not be much better, but the convenience is.

Coins

You can't exchange coins once you have left a country. Exchange them before you leave, drop them in a charity box, or souvenir them. Becoming familiar with coins and currency for your destination country and not mixing coins from various countries in your purse or pocket can save you collecting too many coins before you depart. To avoid accumulating too many coins in the first place, use them as much as possible to pay (instead of notes) during cash transactions. Some countries have coins that are relatively large in value (such as CAN$2 coins), which are advisable to spend first.

Carrying money across national borders

Countries track large movements of money across national borders. If you are transfer money between international bank accounts, this is done automatically, but if you carry large amounts of money (typically more than $10,000 US, Euro, or similar hard corrency) you will need to declare it. Don't forget monetary instruments such as traveller's checks count as well.

The rules about personal and business checks can be confusing. If the check is "cashable" and payable to yourself, a travelling party, etc., that counts against the total. But, when abroad, you can mail a cheque to someone in your home country (or do it online) provided the bank in which the check is drawn is located in the same country as the payee. (If not, you must report.) In other words, the funds never accompanied you, and you're just giving permission to your home bank to pay someone domestically. Having to pay taxes is not an excuse for non-reporting, but then again, the funds to pay them would have to be located in another country for these rules to apply.

Some nations (mostly third world) have such a low import/export limit in the country's home currency (but not US dollars or euros), that these limits may represent pocket change. Often, this is due to local laws not having been updated for hyperinflation. However, in such cases, the currencies are generally not convertible abroad, and/or the rules not always strictly enforced.

Getting money in an emergency

American Express credit card holders can get emergency cash in the form of its traveller's cheques at foreign American Express offices, and designated affiliates (often a travel agency or bank). If the location is not a bank, you will have to go to one or a foreign money exchange to cash the cheques. Be sure to bring a blank cheque from your checking account back home or at least know the routing and account number (the digits printed at the bottom of each check). There is a one percent fee for issuing the traveller's cheques, and the total sum is NOT a cash advance on your American Express card. (They will cash advance your credit card without further permission from you if there's a delay in cashing the check, though. Keep tabs on your checking account, and make sure it clears in a few days.) Also, there's no requirement that you're destitute, as the service is available for whatever reason.

If you have someone willing to send you money, there are several options for getting money fast in an emergency. These include the following:

  • Get money from a friend via wire transfer services like Western Union. If you know your credit card numbers, you can use Western Union to wire yourself some money.
  • Having someone back home directly depositing money into your bank account. You then use an ATM to make withdrawls.
  • Sending a few notes via an overnight courier service (this is reliable, but is sometimes not allowed in the courier company's terms of service.)
  • You could sell personal possessions such as a camera or sport watch.


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