Question to worldwide members (regarding currency exchange)

Please name your country and state what the situation there is regarding international currency exchange.
I read that Icelanders can now only buy foreign cucrrency with proof of intent to travel, and that got me wondering how countries generally handle that sort of thing.

I think Iceland is a special case at the moment. Normally people only buy foreign currency if they are going to travel or if they are buying something outside the country. However, the plastic revolution has changed the mechanisms. When you travel, you can get money at ATMs after you arrive in the country, and when you buy from overseas, you can use your credit card. In both cases the bank(s) or the credit-card company handle the foreign exchange.

I suspect that the government of Iceland is trying to slow down a run on their currency, with Icelanders buying up Euros or US dollars as a hedge against the future collapse of the currency. Of course, that done on a large scale would just hasten the collapse.

Since this may turn into a poll of sorts, let’s kick it over to IMHO, where you can still get factual answers to your question.

South Africa has had “exchange control” regulations since WWII, which restrict the ability of South African residents to move funds out of the country or to purchase foreign currencies. The aim is to protect the value of the local currency; as the country returns to normality post-1994, the controls are gradually being removed.

The general result is that ordinarily individuals are not allowed to invest more than R750 000* outside of the Common Monetary Area (which consists of South Africa and the neighbouring countries whose currencies are tied at par to the South African Rand). Each person is allowed to purchase up to R160 000 per year in foreign currency for travel purposes; obviously if they can justify a need they can get permssion to purchase more.

To purchase currency for travel you have to have a valid passport and (usually) an airline ticket. You can’t buy the currency more than 60 days before the date of departure, and you have to sell any surplus back within 60 days of your return.

The rules for businesses are, of course, different (and much more complicated). Exchange controls are, incidentally, credited with protecting South Africa’s financial industry from the current crisis, because they have prevented local investors from being heavily exposed to risky foreign investments.

  • The South African Rand (R or ZAR) is currently valued at about R10 = US$1, although it normally trades at about R7 = $1.

Interesting… and confusing. Looking at Yahoo’s 5 year (don’t know where to find longer) currency histories for the euro, pound, and dollar, the Rand has done rather poorly, and is currently at its weakest levels in some time. So it looks as if this “protection” plan didn’t really work out.

What happens if someone does not convert currency back after travelling within the stated time?

Any other countries have restrictions like this?

In Canada, there are no restrictions as far as I know on buying foreign currency beyond the amounts a bank would have on hand. You go to a bank or in our case our local automobile club, pay the fees for the transaction, take your foreign money and go. I don’t think there are any time limits on it, either - we have a small stash of USD that we keep at home for the next time we travel to the US.

Within a 5 minute walk there are at least 3 places where I can change most any amount of cash in most major currencies: USD, EUR, CHF, GBP, JPY plus Czech Crowns and the currencies of neighboring countries.

I keep a small supply of cash (a few hundred $ worth) in several currencies on hand for traveling: EUR, CHF, GBP, AED (UAE Dirhams). Plus I have some Jordanian and Omani currency… these last two would be difficult to exchange in Prague, but easy in the Middle East.

Some currencies are nearly impossible to change outside of their country or immediate neighbor: Syrian Pounds and Yemeni Riyals for example.

Partially correct :wink: The main reason for people not being able to exchange more than 30’000 ISK (whatever that is these days) cash is so the banks quite simply don’t run out of Euro-bills. There just aren’t enough foreign bills to go around.

That you aren’t allowed to transfer your personal money to a foreign account electronically, is for the reason you mention.

(for some reason, I can use my plastic abroad though, but at a ridiculous exchange rate).

This, does not apply in normal cases in Iceland. And I do hope we’ll get back to normal as soon as friggin possible!