Why was US currency not wanted in Novosibirsk, Russia?

April 26, 2007 1:43 PM

Why was US currency difficult to use and exchange in Novosibirsk, Russia?

My brother-in-law, who has never before traveled outside the US and who does not speak Russian, just traveled to Novosibirsk, Russia to meet in person a woman whom he met on the net.

When I talked to him before his trip, I realized he knew nothing about international travel. Among other advice, I told him to take all the money he would need in small-denomination dollars, thinking that he could exchange what he needed, but small denomination dollars were a 'safe' default near universal currency.

Turns out, he had a very hard time getting the locals to take his dollars. When he did exchange, they only wanted his newer bills that were in good condition.

I assume that this problem was due to rampant problems with counterfeit currency. Is that the reason? Can anyone shed more light on this?

posted by tippiedog to travel & transportation (30 comments total)

He just tried to pay local merchants with US dollars? There's no such thing as a "universal currency". When you travel, you should use the local currency, which can be obtained from currency exchange shops, banks, and ATM machines.
posted by mr_roboto at 1:52 PM on April 26, 2007

Yeah that is actually kind of crazy travel advice. The best way to pay for stuff overseas is actually to use a credit card -- you get the best exchange rate of the day and pay only a small conversion fee. If you need cash, make sure you can get cash advances at ATMs with your card.

The reason many people in other countries only want new currency is because they are used to old currency being declared void and they don't know if that has/will happen in the States.
posted by Rock Steady at 2:00 PM on April 26, 2007

When he did exchange, they only wanted his newer bills that were in good condition.

This is common in many parts of the world. In fact the money-changers in many places (SE Asia, and possibly others) will actually give you a different exchange rate, depending on the physical condition of the bill.
posted by Tacos Are Pretty Great at 2:02 PM on April 26, 2007

There was a time when some foreign merchants would take US currency due to the strength of the dollar. (My US dollars were happily accepted in Israel in the late 80's...I've heard that US dollars were popular in the former Soviet Union).

The dollar isn't that great these days.

The closest thing to any universal currency would be traveler's checks and credit cards. There's still no guarantee, though.

"I told him to take all the money he would need in small-denomination dollars"

I would actually think that would be dangerous. At least with travelers checks/credit card, there's a degree of insurance if you lose them/get stolen.
posted by Cat Pie Hurts at 2:03 PM on April 26, 2007

[assuming that] small denomination dollars were a 'safe' default near universal currency.

That was your mistake right there. Honestly, not being rude, but why on earth would you assume that without doing any further research?

Lots of us around the world really don't have a clue how to tell a genuine US dollar (or twenty) from a fake one, or any clue what to do with it if we did have a genuine one. I'm really NOT having a go at you here, just answering the question.

I remember years ago when I was waitressing in Australia, an American sailor gave me a US dollar as a tip. I've no idea what I did with it; I think I used it as a bookmark. It wasn't of any use to me other than that.

It IS true that a lot of major businesses in many places will accept dollars, euros, pounds sterling, even when they're not the local currency, but you just can't assume that without researching first.
posted by different at 2:12 PM on April 26, 2007

euros or the now de facto "universal currency" as witnessed by the relative strength of the euro ( which is probably due in part to the availability of the 500 euro bill which is the international money smuggler / arms dealer / drug dealer's bill of choice )
posted by dawdle at 2:28 PM on April 26, 2007

I have heard from several people in the past year or so that about the only places that will accept traveler's cheques any more are banks. And this is in big cities in Europe. Amex apparently offers a prepaid Amex card that functions like traveler's cheques, but is accepted anywhere the regular Amex card is good.
posted by Rock Steady at 2:34 PM on April 26, 2007

I have an acquaintance who recently lived in Saint Petersburg, and used to pay the rent for his flat in dollars. One day the landlady said that she would only accept payment in euros or rubles from then on. So if the dollar ever was universally accepted in Russia, it isn't anymore. And it's never been a "near universal currency," puh-leeze.
posted by grouse at 2:42 PM on April 26, 2007

I agree that that's not terribly good advice. I was recently in Poland, Estonia and Moscow and while I certainly was never as far east as Novosibirsk, from my experience it was pretty much the same as everywhere else I've traveled -- there is no such thing as a "universal currency", and anyone's best bet is to get local currency through ATM machines or banks. I've never heard of local businesses accepting anything but local currency.

Also, yeah, like everyone else have said, it's a bad idea to travel with a lot of cash in any denomination.
posted by drycleanonly at 2:57 PM on April 26, 2007

(has)
posted by drycleanonly at 2:58 PM on April 26, 2007

It's the sort of advice that might have made more sense ten years ago -- and even then, the D-mark was equally favoured in Russia for those who used 'hard' currency for transactions to cope with the ruble's inflation. With the stabilisation of the ruble, Russians have increased confidence in the local currency, and lean towards the stronger euro as a hard currency hedge.

As an ironic aside, I always tell friends travelling to the US to request small denomination bills from the travel agent or bank, because otherwise they'll end up with $50 or $100s. Try using those to pay a cab driver from the airport.
posted by holgate at 3:30 PM on April 26, 2007

different: "[assuming that] small denomination dollars were a 'safe' default near universal currency.

That was your mistake right there. Honestly, not being rude, but why on earth would you assume that without doing any further research?

Lots of us around the world really don't have a clue how to tell a genuine US dollar (or twenty) from a fake one, or any clue what to do with it if we did have a genuine one. I'm really NOT having a go at you here, just answering the question."

Yes.

I find this assumption seriously puzzling! Does it have something to do with the worldview of the average American?
posted by loiseau at 3:38 PM on April 26, 2007

loiseau: no, that is not the case. Small denomination dollars will probably work as currency in super touristy locations -- think Cancun -- but Novosibirsk is not really a touristy location frequented by Americans, unless there's something huge I've missed. And even then, they rip you off with hugely inflated exchange rates.
posted by kdar at 3:48 PM on April 26, 2007

My grandma told me that during her travels to India, China, Eastern Europe, and South Africa, she kept a wad of $1 bills to give out to people as tips and souvenirs. This was in the late 70s and early 80s. She said that these got her out of lots of sticky situations, soothed tensions with cab drivers, hotel owners, and waiters, and were a big hit with local children.

She told me I should do the same when I was going to Japan, Hong Kong, and S. Korea in 2003, so I brought along $50 in $1s. I never used a single one and would have felt extremely uncomfortable doing so, since I would have fulfilled the stereotype of Americans as believing everybody worships the greenback.

I've no doubt that the Dollar would have been universally accepted in the 70s and 80s, when a significant portion of the world's countries were starved for hard currency. In Eastern Europe and China, for example, the local currency simply couldn't buy imported goods. If you wanted Western stereo equipment or cars or food or electronics, you had to use Western currency (or the convertible, hard currency of your own country, which was entirely different from the money in your bank account). Now, though, the only countries that are that way are hyperinflated African countries (Zimbabwe for one), North Korea, Cuba, and maybe a few others. And even still, if you go to Cuba, the Dollar is held in esteem because it can buy things that the Cuban peso can't really get you--gasoline, for example.
posted by jbb7 at 3:49 PM on April 26, 2007

Does it have something to do with the worldview of the average American?

Up until now, I haven't encountered an American that was dumb enough to think that American dollars were worth anything outside the US. I thought everyone understood that you use local currency in the places you go, with travellers cheques in USD, EUR, or British pounds as a backup plan to exchange at banks.
posted by cmonkey at 3:52 PM on April 26, 2007

jbb7 writes "And even still, if you go to Cuba, the Dollar is held in esteem because it can buy things that the Cuban peso can't really get you--gasoline, for example."

Is this true any more? I though Castro had cracked down on dollar transactions over the past few years.
posted by mr_roboto at 3:59 PM on April 26, 2007

The belief that US dollars were accepted in places outside the US is not completely crazy, although it may be outdated. A few years ago, I went with my dad to Vancouver, BC - an easy drive from the Canada-US border. When I brought up the issue of changing money, he brushed it off with, "Oh they accept dollars." He's not that old either.

Life became considerably more interesting when our car was parked in front a meter we couldn't pay for, while he attempted to get change in a store with his US dollars, and the storekeeper had no clue why he believed they would accept US dollars.
posted by meowzilla at 4:37 PM on April 26, 2007 [1 favorite]

While I agree that expecting to be able to pay with US dollars in Russia is a little strange, it's not uncommon for some tourist-y places to take foreign currency.

For example, when my wife and I went on a cruise for our honeymoon to Vanuatu and Noumea, most of the islands took Australian currency and nothing else! I guess that in these places, the previous posters are correct and that Aussie dollars are a better choice than the local currency. The only place we had to change currency was New Caledonia, because it is a built-up city.

Of course, I got the impression that a lot of the places we went to were supported almost exclusively by the cruise ships, so maybe that also has something to do with it....
posted by ranglin at 4:40 PM on April 26, 2007

I was told when I was in Moscow in 2002 that it was illegal for the average Russian citizen to conduct dollar transactions. I'm not entirely sure if that's correct or not though.
posted by knapah at 5:07 PM on April 26, 2007

He shouldn't have expected a problem exchanging USD for local currency, but it sounds like what you advised him to do is expect to pay with USD. Not gonna happen.

No offense, but my guess is either that you are just as unaware about international travel as he is or your awareness is relatively stale, as mentioned above.

Your best bet nowadays is simply a credit card and an ATM card. You should get the same exchange rate with both, and ATM is usually the better route because you avoid the percentage fees that nearly all credit card companies charge for foreign transactions. Then only upsides to a credit card over an ATM is that you don't have to carry cash and you don't always have to find an ATM. But speaking strictly in terms of cost-effectiveness, withdrawing local currency from an ATM is the best method.
posted by jckll at 5:16 PM on April 26, 2007

While it is pretty odd to think that you might be able to get by in Novosibirsk without having to change anything to rubles, I don't think it is unreasonable to expect to be able to exchange US dollars into rubles there. I think your mistake was in insisting on small bills. Money changers want nice, clean, fresh $50s and $100s, at least in my experience in Russia.
posted by ssg at 5:28 PM on April 26, 2007

There's a money exchange place in my hometown in JB (Malaysia) which accepted US dollars based on certain serial numbers - either they only accepted some or denied some, I don't recall. I suspect that's actually become more common.
posted by divabat at 6:00 PM on April 26, 2007

"It's the sort of advice that might have made more sense ten years ago"

My mother went on a mission to Berezniki, Russia in '95, and she confirmed to me that, at that time, dollars were in great demand there. Her experience was much the same as jbb7 describes.
posted by mr_crash_davis at 7:10 PM on April 26, 2007

Small denomination USD are very useful in Southeast Asia, especially when you get less developed (they're basically the normal currency in Cambodia, for example, and the few international ATMs dispense them). In a place like Hong Kong, where I am now, they're useful only if you can find someone to change them.

Use ATMs whenever available. Bank rate, most non-US banks don't charge fees, and you can find a US bank that won't charge a fee on its end. Travelers checks are a pain but decent backup, depending on where you are.
posted by deeaytch at 7:18 PM on April 26, 2007

Like grouse's friend, I paid for my apartment in Voronezh, and also tuition, in US dollars. My understanding at the time (2003-2004) was that all large purchases were done in dollars and sometimes euros. Any car price, for instance, was advertised in dollars or euros. What's more, I only once used an ATM in Russia (Moscow, Petersburg, Voronezh, Vorkuta, Syktyvkar and a few other places) that didn't give you the choice of withdrawing in dollars, though often, if I remember right, only in $100 notes. Availability of ATMs with dollars may have since changed.

I'll also add that it's beyond crazy to think a Russian selling beans in a market (or whatever small purchases the friend was trying to make) would take US dollars. I had a hard enough time trying to get cashiers to take money that wasn't exact down to the last kopeck....
posted by msbrauer at 8:13 PM on April 26, 2007

What is A (Hundred) Dollar Bill Worth? (quoted from the WSJ):

In many countries, from Russia to Singapore, the dollar's value depends not just on global economic forces that move international currency markets, but also on the age, condition and denomination of the bills themselves. Some money changers and banks worry that big U.S. notes are counterfeit. Some can't be bothered to deal with small bills. Some don't want to take the risk that they won't be able to pass old or damaged bills onto the next person. And some just don't like the looks of them.
posted by sfenders at 8:39 PM on April 26, 2007

"While I agree that expecting to be able to pay with US dollars in Russia is a little strange.."

Sadly, I've seen Americans here in London try to convince locals to take dollars. Some of my countrymen don't travel well.
posted by Mutant at 11:16 PM on April 26, 2007

you shouldn't expect to pay with usd, or euros, or anything except rubles in russia. usd might be fine in a private transaction but in a shop, restaurant, hotel they are completely out of the question. and illegal for payment, too.

re changing us dollars: currency exchange places are gonna want new or nearly new bills (they either won't take or will offer a discount rate for old/damaged bills) and highish denominations (they don't want bunches of ones, fives, tens).

if you're travelling to russia, either get your money from an atm or exchange brand-new $100 bills at the currency exchange places.
posted by londongeezer at 3:44 AM on April 27, 2007

euros or the now de facto "universal currency" as witnessed by the relative strength of the euro

This isn't true. Perhaps in Europe (including outside the eurozone) they are, but not worldwide.

And [the dollar has] never been a "near universal currency," puh-leeze.

It's the closest thing to a universal currency that anyone living has ever seen.

That said, you'd be crazy to try to insist on using it outside the U.S., even in Canada, which is probably the most USD-friendly place outside the U.S., and in which you will get a horrible exchange rate (even or worse) if they even take it. Just get local currency, no matter where you're coming from or where you're going. It's just easier.
posted by oaf at 8:51 AM on April 28, 2007

It's the closest thing to a universal currency that anyone living has ever seen.

And even that is not "near universal" in my opinion.
posted by grouse at 9:11 AM on April 28, 2007