FAQ (and not so FAQ)

Money

Most recent update: January 24, 2009

1.) What is the proper currency to use?
2.) Doesn't using the local currency result in cheaper prices?
3.) So change is given in riels, do the merchants cheat you?
4.) What size notes are there for the local currency?
5.) Where can I change money?
6.) Are there a lot of counterfeit bills floating around?
7.) Does the condition of the bills make a difference?
8.) It's going to be a Euro world, my Euros are just as good as dollars, right?
9.) Are there any ATMs?
10.) Can I use a credit card?
11.) How about traveler's checks?
12.) Any advice on bargaining prices?
13.) What's the deal with tipping?
14.) How much should I give to beggars?
15.) Is there a kickback/commission system with hotels and guesthouses?

Q: What is the proper currency to use?

A: The official currency is the riel, however the de facto currency is the US dollar and most prices are quoted in dollars. Even the government quotes fees in US dollars. As there are no coins in Cambodia, riels function as small change and you'll accumulate some during your trip. There is no reason to change significant quantities of cash into riel, but it's a good idea to carry a few thousand riels in your pocket for moto drivers (they NEVER have change) and other small purchases. Thai baht is also an acceptable currency and is used as often as the dollar in border areas such as Koh Kong and Poipet as well as Sisophon and Battambang. As you move farther east, using Thai baht tends to increase the cost of things as some businesses, particularly western-owned ones, don't give very favorable rates (some rate the baht as high as 50 to the dollar) so you'd do better to switch to dollars. Most money changers give good rates on baht to dollar exchanges, so it usually works out better to change first. The riel is presently in the range of 4000 to 4100 to the dollar, though for convenience many shops still use 4000 as the exchange rate, though often only if it's in their favor. While large bills cause nowhere near the drama they used to, it's still a good idea always to have some small bills (ones and fives) as you can never be sure of getting change on larger denominations.

One thing about the exchange rate, many businesses will use the 4000 : 1 ratio when making change, regardless of which direction, but if you're making a larger purchase, for example settling a guesthouse bill, and pull out a few hundred thousand riel to pay it the business will almost certainly use the true exchange rate, so don't freak out when they multiply your $80 tab by 4060 instead of 4000. When they charged you 2000 for a $0.50 purchase they were doing you a favor.

Q: Doesn't using the local currency result in cheaper prices?

A: Not in Cambodia. For all intents and purposes, the US dollar is the currency of Cambodia. If anything, using riel for larger purchases may cost you more, not less, than if you used US dollars.

The only time riel might save you money is for purchases under a dollar, as sometimes in the asbsence of any riel, a 2000 riel purchase turns into one dollar, "sorry no change."

Q: So change is given in riels, do the merchants cheat you?

A: Not really. Most businesses either use 4000 to 1or 4100 to 1 in both directions. In the case of the businesses using 4000 when you pay you win, when they give you change they win, so it evens out.

About the only real case of cheating I can think of was a few years back when the exchange rate was around 3900, Caltex used to take your money at 4000 but give you change at 3900. While the few pennies may be nothing to you, someone (I want to say The Phnom Penh Post but I'm not sure) determined that with the thousands of daily transactions made by their dozen or so stores each day, their annual profit just on exchange would have been well into five figures!

There is a 50-riel note in circulation that supposed to allow for more exact change but it's doubtful you'll ever see one.

Q: What size notes are there for the local currency?

A: 50, 100, 500, 1000, 2000, 5000, 10000, 20000, 50000, 100000. Occasionally you may come across an older 200-riel note but they don't make them anymore. Also, it's very unlikely you will ever see a 50-riel note or anything over 10000 (the 20000-riel note is brand new). Many locals have never even seen a 100K note. Be careful with the 5,000 and 10,000-riel notes as they do look a bit similar and a few unscrupulous money changers might try to slip you a few 5,000s in place of 10,000s.

Q: Where can I change money?

A: The best place to go is to any of the hundreds of private money changers. Do not bother with banks as most would rather not be in the money changing business. You'll always see a concentration of money changers around the markets, but they are everywhere. They can be recognized by the glass case full of money (also a testament to the general honesty of most Khmers), most of it riels, and two numbers on the glass, both numbers being 40xx, 41xx, or 42xx. These numbers are the present exchange rates for US dollars and riels. Exchanging dollars and riel is a straightforward process and rip-offs are extremely rare. With any other currency some bargaining may be necessary. Japanese yen, euros, and baht seem to pose no difficulties, though rates may vary slightly from changer to changer. However, the more obscure the currency is, the less likely the money changer will know the actual rate nor be willing to offer a fair rate as it may be more difficult for them to reconvert the notes. It's also been my experience that in most cases the money changers will offer a better rate than the hotels regardless of what currency you're changing.

There is presently a scam being placed upon tourists arriving overland from Thailand at the Poipet border crossing. The tourists are being told they must exchange as much as 100 US dollars into riel and are then being given only 3400 riel per dollar, or even worse 75 riel to the baht. If you were to change $100 you would be cheated by nearly $15. There is no law in Cambodia that says you have to change riel into dollars. If you are asked at the border to change money simply deny that you have any cash on you never mind they'll tell you there is no way to obtain cash in Siem Reap. No matter how convincing they may seem, EVERY reason they give you as to why you must change money is a lie. EVERY one of them.

For the most part, this scam is dropped on the people using the tourist buses from Khao San Road. If for some odd reason you've chosen this ridiculous option to get to Siem Reap make the same claim as above, "sorry mate no cash, hitting the ATM in Siem Reap. Bye." Better yet, don't take a bus from Khao San Road.

Q: Are there a lot of counterfeit bills floating around?

A: Yes there are fake US notes around, but unless it's a really poor counterfeit, if you try hard enough you'll eventually be able to unload it. The best place to get rid of it would probably be in paying your airport departure tax as they don't seem to check the money their handed.

Q: Does the condition of the bills make a difference?

A: For Cambodian riels you will see some bills so worn and torn you might have trouble figuring out what denomination it is. But with US dollars from $10 and up rips can be a problem. Generally speaking, the larger the bill the more picky people are about rips. The slightest rip in a $50 or $100 and you'll never get rid of it, but a $1 or a $5 and nobody may care. On my very first visit to Cambodia I got stuck with a torn ten-dollar bill that nobody would take until finally as I was leaving via Pochentong (Phnom Penh) International Airport they took it when I paid the departure tax and I've found that the airport still is usually a good place to unload dodgy bills.

With printing technologies what they are today, a simple rip is no longer the only reason money may be refused. Bills that are excessively worn, such that the original texture of the paper has been lost are becoming more of a problem. Also becoming problematic are what they call "small portrait" bills. These are the older US bill design where the portraits are smaller (mid 1990s I believe is when they were replaced?). 5s and 10s are usually spendable without too much fuss, 20s can be a little difficult and 50s and 100s are sometimes very difficult to spend as quite a few businesses will flat out not accept them and of the couple of counterfeits, or bills I was 90% sure were counterfeits, they were all "small portrait" notes.

Why so difficult to spend worn or torn bills? Two reasons I think. One of course, is improved counterfeiting technologies. As a merchant who conducts a lot of cash exchanges at the local banks, I'm finding banks are scrutinizing money much more carefully than before, and as a result I am becoming much more careful about the condition of the money I accept. The second reason (I think), is that as the US dollar is not an official currency there is no central bank to clear out old bills so as they become excessively worn they eventually become worthless.

The best course of action is to see that your US dollars are new and crisp. Then everyone will be happy to accept them.

If you are receiving money from a bank or money changer, check every bill and don't be shy to turn one back if you don't like the appearance of it. I've often handed back bills at several different banks and they've exchanged them without question.

And don't assume because you got cash from an ATM that the notes are fine. I've seem some very dodgy looking notes come from ATMs here.

Q: It's going to be a Euro world, my Euros are just as good as dollars, right?

A: Not so fast. The US dollar still remains the de facto currency of Cambodia and there is nothing to indicate that this is going to change anytime soon. However, as the euro is a major currency, you can at least get a fair exchange at the market. For what it's worth, most businesses will accept euros, but you will find that the rates quoted won't be as favorable and in most cases it is to your advantage first to change the money to dollars and spend the greenbacks.

Q: Are there any ATMs?

A:YES!!!!!!!!!!!!! Cambodia finally discovered modern banking in January 2006 when internantional ATMs popped up first in Phnom Penh and then spread quite quickly to Siem Reap and Sihanoukville and beyond. While I still wouldn't be expecting to find one in some backward provincial town, in the main population centers they're all over the place.

In Siem Reap (and in Phnom Penh) if your card won't work in the ATMs you can still get a cash advance from numerous banks, money changers, and travel agents with commissions usually around 2%. Some other businesses (hotels, etc) also offer cash advances but their charges tend to be a few percentage points higher than the previously mentioned places. In Siem Reap, Canadia Bank offers free advances on Master Card and Union Commercial offers free advances on Visa. Both of these banks are located next to the Old Market. I would imagine the same no commission policy also holds true for their Phnom Penh branches. But in all likelihood, the new ATMs will take care of you.

Q: Can I use a credit card?

A: Yes. Many hotels, guesthouses, as well as some restaurants and souvenir shops now take plastic and more are doing so every day. While cash is still king, plastic goes a lot further then it did even a year or two ago.

You can however, expect at many businesses to pay a 3% to 4% service charge for doing so. Yes, we all know that the Visa/MC/AmEx agreements prohibit this sort of thing but the agreement is between the banks and the businesses and is, quite frankly, none of your business. If you don't like the 3% surcharge, shut up and pay cash.

Get real, large hotels chains who are likely getting 80%, 90% or more of their business in plastic have already buried the 3% into their room rates, so what about a small business where credit card usage may be only 20% of their total business? Should the cash paying customers subsidize the credit card users? Or should the credit card users pay directly for the privilege? One way or another, that 3% will be passed on to you. I think it's rather nice that in Asia, businesses can more openly post 3% and 4% service charges without fear of the credit card police coming in and threatening them with all sorts of criminal acts.

The convenience to you is only a cost of a few dollars, but the total of all charges in a given month really can be a bit heavy of an expense for small businesses to carry. Just accept it or pay cash. End rant.

Q: How about traveler's checks?

A: You can cash them in at many banks and money changers at a 2% commission. Spending them is a bit more problematic as many businesses don't want to be bothered with them. Cash is king. Plastic is queen. Traveler's Checks, well, I'd say they are at best a court jester.

Q: Any advice on bargaining prices?

A: In general, go easy. With a few exceptions, the Cambodians are not the ruthless hagglers like their Vietnamese neighbors (unless you're trying to sell them something, but as a tourist you're not likely to be in that position). The biggest exception is dealing with long-distance share taxis, especially in Poipet, Sisophon, and Siem Reap where attempts at overcharging tourists to considerable degrees is common. See the Transportation section for more info. Souvenir shopping should be an enjoyable exercise and while you can haggle a little, if you're just picking up a t-shirt, krama, or something relatively cheap, lighten up a bit. Profit margins are slim and they need the extra 50 cents a lot more than you do. Remember, while you have to purchase transportation, food, and lodging, you don't have to buy a t-shirt, so don't haggle with the seller like your survival depends on getting the cheapest price for the item. Some of the souvenir sellers around the temples can be a real pain in the rear, but that's not an excuse for haggling fifteen minutes over two thousand riels. Pay up or shut up.

It still amazes me that there are tourists who will try to beat down these souvenir and drink sellers for 500 or 1000 riels, take the attitude that every transaction with a Cambodian must be BARGAINED! BARGAINED! BARGAINED! and then at the end of the day, walk into a western-owned bar, run up a $15 to $20 tab and pay it without thought. Just once I'd like to see one of these people try to bargain the cost of a beer with a western bartender. Why do you feel you have to BARGAIN! BARGAIN! BARGAIN! with people who make $40 a month but you think nothing of dropping half that amount on beer from a bar that makes thousands a month. Get a grip, will ya'?

WARNING!!! Be very careful shopping for gems. Trust no one.

Q: What's the deal with tipping?

A: In general, tipping is not done in Cambodia. But this doesn't mean you can't do it. In restaurants and bars that do a lot of business with westerners the staff is often accustomed to receiving tips and it's a nice bonus to their often meager monthly wages. If you're particularly taken by the service you receive (or the server as the case may be), feel free to leave a tip. Most businesses have tip boxes and the money is divided up equally among all staff.

With tour guides, if you arranged for the service from your hotel or guesthouse a small tip for a job well done will also be appreciated as some of the $20-25 daily fee you pay will have to be returned to the establishment as a commission as well as to the tour guide agency.

With anyone else you encounter, motodrivers, a helpful shopkeeper, etc, you can always pay a little more than requested if you feel the money is deserved.

Q: How much should I give to beggars?

A: Personally, I don't think you should give them anything. Yes, many are one-legged, many have had very unfortunate histories, but what are you going to do, give them *all* something? And keep in mind, there are many more Cambodians who have suffered just as much and more and they have managed to put their lives back together again without resorting to begging. Like about 99+% of them.

The beggars around the Old Market in Siem Reap are making as much as $15 a day shaking their hat at tourists. This is many times what the average Khmer earns and this fact is not lost on them. Yes, many locals do resent these beggars. Most of the beggars you see around the tourist areas are beggars by choice, not by need.

Keep it in mind when you feel like dropping a dollar in the hat of a beggar that one dollar may be close to the full day's salary for the girls cleaning the rooms in your guesthouse or hotel. So basically you've just rewarded a voluntarily unemployed beggar with the equivalent of a day's salary for the girl spending nine-hours a day scrubbing the dirt off the floor of your room. Doesn't make a lot of sense, does it? Tell you what. If you want do something constructive, put the dollar back in your pocket and when you get back to your guesthouse track down one of the cleaning girls and give her the dollar.

Reward good service, reward a job well done, but there's no reward for shaking a hat muttering, "Papa, som muay dollar " (Papa, one dollar, please).

Q: Is there a kickback/commission system with hotels and guesthouses?

A: Yes, there is. And it is very well established and you can't do much about it. In fact, there's hardly a transaction of any kind in Cambodia that doesn't involve some kind of kickback or commission for somebody. As a tourist it can affect you in several ways.

Hotels and guesthouses. Some establishments actively encourage taxi drivers and moto drivers to bring guests by offering commissions of as much as $10 per guest and in some cases cuts of up to 50% of the customers entire bill for the length of their stay! This is the system at its worst and many guesthouses, including Khmer-owned guesthouses, would like to see it go away. As all the drivers know which hotels and guesthouses pay this kind of money there's no way you can sneak around it and it probably wouldn't save you any money if you could. Yes, the commissions are buried in the cost of the room but if you somehow managed to sneak into the hotel without a driver you'd still probably pay the same for the room. The problem that develops with this system is that due to the high payout it can lead to additional pressure on you from taxi drivers trying to steer you to the hotel or guesthouse of their choosing and not your choosing. It's an annoying situation to be in and the only advice I can offer is that if you find yourself with a driver uncooperative about taking you where you want to go you stand your ground and insist that he does.

The commission game extends beyond just hotels and guesthouses. It also includes restaurants, souvenir shops, one-hour photo labs, etc. And again, you really can't do anything about it. You should only concern yourself with it when a driver declines to take you where you want to go, "Oh, you don't want that restaurant, food no good there, but my brother, he have very good restaurant, very delicious."

The big souvenir shops pay commissions of up to 30% and even 40% to the tour guides that bring in customers. Photo labs and other small businesses that tourists might visit will often kickback a small tip to the motodrivers.

While there's no denying that some of the high commissions paid by hotels and guesthouses often lead to more aggravation for the tourist, there are also ways that small kickbacks can make things better. There are many tourists who have raved about helpful motodrivers going out of their way to shuffle them around on a bunch of silly errands, finding them a good photolab, a place to get their bag fixed, whatever. Did the motodriver receive small tips along the way? In many cases, yes. And the tourist got great service from the driver and the driver made a few extra bucks. Everybody wins.

Return to FAQ index.

Cambodia

Home

All text and photographs © 1998 - 2009 talesofasia.com. Commercial or editorial usage without written permission of the copyright holder is prohibited.