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Changing Into The Local Currency

Discussion in 'Asia' started by Corzhens, May 19, 2016.

  1. Corzhens

    Corzhens Active Member

    We need foreign currency when traveling abroad and we have been exchanging currency in many ways - first with the local bank or the local money changer, in the local airport's money changer, in the foreign airport's money changer, etc.

    Based on our experience, the best means of obtaining foreign currency is to withdraw from the foreign ATM using my credit card. The billing at home showed that the mark-up is minimal and it is even an advantage compared to changing US dollars in the foreign money changer or in the airport. Except for Singapore where the money changers have the best rates (particularly in Mustapha mall), I would advise the credit card withdrawal. That's now my standard upon reaching the airport of destination, I look for an ATM machine.
     
    Coco likes this.
  2. Coco

    Coco Active Member

    Very well said. One advice I can give travellers would be this: Avoid converting money before leaving your country of origin. You would always get a terrible exchange rate this way. If you compare the wholesale rate of currencies, you would see a huge difference. You would end up losing money because of this. Yes, it's more convenient since you won't need to find ATM machines once you land in the airport of the courtly you're visiting. But is it worth it to lose all that money? I would say no, and it's way better to follow @Corzhens advice.

    But to make sure that the airport has your ATM card provider, you need to search it beforehand, before going into your trip. The good news is, there are about 800,000 ATMs already worldwide, so the chances of not obtaining money through them is low. The ATM is definitely the cheapest option when it comes to exchanging your money into the local currency. Yes, there might be fees but it's undeniably lower than other options.

    Your other option would be using your credit card for transactions, which have a one to two percent conversion rate. It's better to call your credit card company to know for sure. The other advantage with credit cards is that it's easy to dispute purchases with it. Do not ever use your debit cards for purchases as disputing purchases will be very difficult.
     
    Corzhens likes this.
  3. Valerie

    Valerie Active Member

    I too agree with the advice that @Corzhens is giving. Having been to a few different countries and trying different services, like traveller's checks, foreign currency exchanges like Travelex, ATMs, Western Union, bank transfers and remittance services, I have to say that the ATM or credit card purchases are the way to go.

    Travelex and remittance services give a flat rate that is actually not very agreeable in the long run. Western Union wants the life of yournfirstborn child to send money abroad, and traveller's checks are just a hassle.

    However, you have to keep in mind the location where you'll be visiting. Some places might be a straight up, cold cash kind of place where plastic cards aren't very convenient. Like Japan. More places are accepting electronic payments, but a vast majority of stores and restaurants will only accept cash. That's where the ATM comes in handy. The withdrawal and transaction fee for 100.00 USD is about 5.00 USD in total. Although, this goes up with greater withdrawals.
     
    Corzhens likes this.
  4. Corzhens

    Corzhens Active Member

    Thanks for that info. We have a trip to Osaka, Japan in March of 2017 and at this early, I am already compiling suggestions, advice and tips on what to expect and what to do in Japan especially in terms of finances. I only use the plastic card for withdrawing cash from the ATM machines although there are places like Singapore and Hongkong where I pay using credit card in my big purchases of shoes and bag and sometimes grocery items too.
     
  5. Rachel

    Rachel Member

    I usually take a pre-paid credit card that I have loaded up with currency - I can use this to draw money out or as a credit card in stores/restaurants. I also make sure I take enough cash for at least the first 48 hours of my trip, until I get my bearings - I would take at least the equivalent of £200 in the local currency, in cash.
     
  6. Miya

    Miya Active Member

    I gotta disagree with the taking money out from the credit card method. I don't know if it's just a case by case thing, but my credit card charges amazingly high fees if I withdraw from it (even in my home country). I could use a debit card, but they also take a huge fee. When I moved to Japan, I got my currency exchanged at the bank in America. They took out a fee too, but it was a flat fee so it worked out better for me. Before I came to Japan, the company that employed me told me that Japan is a cash country and we shouldn't rely on cards to get money. It's inconvenient and if you run into problems, most likely you will not find help because the people here are unfamiliar with cards. So I bought a ton of cash with me that I exchanged at the bank back in America.

    When I go to Korea later this year, I think I'll just exchange my money at the airport (in Korea). I will probably get terrible rates, but it's probably the most convenient.

    Japan is a cash country and many places will not take cards (they won't even have the card reader available). You should be able to use your credit card at big department stores and big chain restaurants, but other than that you'll mostly be using cash. If you are paying an entrance fee to a tourist spot, you'll need cash. If you are buying from a smaller grocer, you'll need cash. I would recommend withdrawing a lot of cash at once because in Japan, ATMs close. They are not 24 hours. You might not have access to an ATM machine after a certain time. If you do find one and use it after it closes, they will charge you a fee. Most ATMs will also charge a fee on the weekends. So be aware of that.
     
    Corzhens likes this.
  7. Corzhens

    Corzhens Active Member

    All along I thought Japan is so advanced with electronics so I am surprised to learn that it is a cash country as you said. I only withdraw money from the ATM once or twice when I am abroad and always depend on cash although sometimes I use my credit card when the establishment accepts. But now that I know about Japan's prevailing financial culture, I guess I really have to be ready with the cash. By the way, I also bring along some US dollars for safety purposes in case we run out of local currency. At least the dollar is accepted in some hotels and big restaurants.
     
  8. amelia88

    amelia88 Active Member

    I worked in finance for a little while, so I was actually able to get a good deal on foreign currency through the bank I worked for - they didn't charge commission on foreign currency to their employees! But otherwise, most financial institutions do try and take their cut from the sale - so it can add up there.

    Most of the time I just try and withdraw how much cash I think I'll need in one go - but for the most part I prefer to use card when possible. A couple of reasons for that - it's just easier for me to keep track of transactions, and of course there's the concern that cash can get stolen. You lose your wallet, your cash is often all gone - but if your card gets stolen you're able to dispute any charges through your bank that weren't made by you. At least, that's the case here where I live.

    Obviously some places are more reliant on cash and you may not have the opportunity to pay with card everywhere you go - so I always think it's wise to try and research your destination a bit before you go, to get a feel of what the situation will be.
     
  9. Miya

    Miya Active Member

    That is indeed the image Japan gives people.

    But it's a false image. Japan is actually really behind on a lot of stuff... and the rest of the world doesn't know it.

    If you find a place that accepts credit card, you should use it and save your cash for places that only take cash. Food stalls will definitely only take cash and you definitely want to try those in Osaka so make sure you have enough on you. Don't worry about carrying too much money. Japan is a safe country and if you drop your wallet, it's likely you'll find it with nothing missing. And since it is a cash country most people carry a couple of 万 (10,000 yen bills) with them everyday. I always keep at least 2万 (about $200 USD) with me in case of emergencies.
     
  10. crimsonghost747

    crimsonghost747 Active Member

    There are exceptions to the rule but I've found that the ATM method usually works best for me. What I try to do is to grab as much money as I need for a trip, or if I'm not sure how much I'll be using then at least get enough to last for 50% of the trip. Repeated withdrawals from the ATM will still add up in fees.
    If the country is one that you consider relatively safe from fraud, you could also just keep paying with your credit card in which case you might make it through with very small fees. (again, depends on your card)
     
  11. christine

    christine New Member

    I'm not sure if withdrawing from your credit card is the best option because it is considered as a cash advance and you'll be charged a cash advance fee, conversion fee, and interest from day one. Whenever we travel we make sure that we have enough US dollars for exchange to fund short trips, food, and bargain hunting. I only use my credit card to pay for purchases in department stores and hotel stay.