Travel: Understanding and Using Foreign Currencies

Traveling the world and interacting in new and different cultures is a very rewarding experience. Having said that, it can also be a little overwhelming at times, especially if you are new to international travel.

One of the most problematic areas where people struggle is understanding foreign currencies. Thankfully, we have modern technology, more specifically, applications that can make that a little easier for us. Although the United States dollar (USD) is widely accepted as a means of payment in many countries around the world, when possible, I prefer to use the currency of the country I am visiting. I do this for a few reasons:

• Some countries discourage the use of another counties currency
• No need to figure out the exchange rate at the time of purchase
• Additional "fees" or "taxes" for using USD (typically a vendor taking advantage of a tourist)
• Looks very "touristy" 
• Having local currency sometimes allows for better price negotiations on certain things
• Language barriers ​                                          

 FOREIGN CURRENCIES

Although symbols, shapes, sizes, and numerical amounts differ from country to country, some similarities remain the same. In most cases, the physical bill size is proportionate to its value. Meaning, the smaller the bill size, the smaller the amount it is worth. Typically, their size goes from smallest to largest, which makes it easier to recognize value placements of currency when dealing with several different bill denominations. The same is also true with coins. 

Even though you might have a bill from a non-English speaking county in hand, there is a good chance somewhere on that bill the numerical value is represented in English. For example: if you are purchasing goods in Jordan and they tell you 50 dinars (JOD)" you can do the math by simply locating the numbers. ​

       Omani (OMR)currency 

WHAT DID YOU SAY?

 In my opinion, the language barrier problem is often overlooked when paying for something using a currency other than the local one. 

Example: let's say you are in Bangladesh and you find a souvenir or something you want, but only have USD. You go to pay and they tell you "3,000 takas (BDT)". If you do not know the exchange rate, your response most likely would be, "what is that in USD"? If they do not speak English or you do not speak Bengali, chances are there is going to be quite a bit of confusion. 

This could have all been avoided if you just exchanged currencies and when they told you the amount, you handed it to them. Although the language barrier still exists, 3,000 takas is still 3,000 takas.                                                                                          

  YOURS FOR MINE

Exchange rates (the rate at which one currency is exchanged for another) can often lead to confusion, hair pulling, and the occasional four-letter word. This can be amplified when you are in a hurry or other stress-induced situations. To further complicate things, most exchange rates have daily, weekly, and monthly fluctuation. Although the differences might be minute, they still exist and should be factored into your travels. 

If you do not like the idea of always checking, fear not, some counties have fixed exchange rates! For instance, the Omani riyal (OMR) has a fixed rate to the United States dollar (USD) of approximately 0.38449. This simply means, one USD is worth approximately 0.38 OMR. From my experience, the list of fixed rate countries is smaller than those who do not have one.

Like I mentioned at the beginning of the article, there are applications that make it simple to track exchange rates. There are several great currency converters out there, but the one I use the most on my iPhone/iPad is called XE, which can be located in the App Store. They also have a website (xe.com) in the event you are using a computer.   

On the plus side, if you are using the local currency, it takes a lot of the guesswork out of it when paying for goods and receiving change back, but you should still be mindful of the exchange rate to determine the true cost/value of something.  

For example: if you are visiting Kenya and exchanged your currency (let us say USD) for the Kenya shilling (KES), which has a fluctuating exchange rate (minimal movement) and want to buy a painting from a local artist for 5,500 shillings (KES). Before making your decision, you would probably want to know the amount/value in your currency (USD), which at the time of writing this article would be about $54.00 USD. Understanding that helps ensure you make an informed decision.  

Whether you are in a country that has a fixed or fluctuating exchange rate, the locals will know the exact exchange rate at the time. If you are not up to date, there could be a chance that you pay a different amount and it will not be in your favor. ​

PLASTIC MONEY

The majority of vendors in most countries accept credit/debit cards as a means of payments, but that does not mean it will always work. This could happen for several reasons:

• You did not notify your card company or bank about your international travel, therefore they decline the charge
• Card type not supported
• User error on the side of the vendor
• Connectivity issues on the side of the vendor

If your card does not work, cash is king, but if you only hold your country's currency and they do not accept it, then you might be in a bind, especially if it is for a service they already provided (meal, taxi, tour, etc.). This is another reason to have local currency on your person, even if you plan on using your card everywhere.

CONCLUSION

In my opinion, if you are in a country for more than a few days, it is a good idea to exchange money, especially if you plan on site seeing. Keep in mind, typically there is a fee associated with exchanging money and sometimes those fees are more if you do it in "convenient" place like airports, banks or hotels. ​

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The world is a large place, and life is short. Together, we can accomplish much more than we ever could alone.
-Bourn Adventure

Author: Baker

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