How Does Money Work in Cambodia?

If you're coming to Cambodia for the first time it can be slightly confusing that two currencies are used here. Riel is the official currency of Cambodia, but look at the price of almost anything and you'll see that it's listed in US dollars. So which currency should you bring with you? Which is more useful here?

The short answer if you don't want to read any further: It doesn't matter.

What are Cambodia's two currencies?

US dollars ($) and riel (៛) are used in Cambodia pretty much interchangeably. Prices are almost always listed in dollars, sometimes alongside the riel amount. No matter what is listed, all businesses will accept dollars and riel without preference. In the vast majority of instances, businesses will use an exchange rate of $1 = ៛4,000, although you will on rare occasions find places that use $1 = ៛4,100 or even $1 = ៛4,200.

Confusingly, no matter which currency you choose to pay in, your change will usually be given to you in riel, in rare cases will be given to you in dollars, and will sometimes even be a mix of the two. Quite simply, you need to become comfortable handling both currencies because you won't be able to avoid either of them if you spend any significant time here.

If you choose to pay by card, almost all transactions will be charged in dollars, although in rare cases (most notably the Grab app) your card will be charged in riel instead. Note that this is still a cash-first economy. Although some businesses do accept cards, many do not (and I've had instances where the card machine has been broken), so you should always have the cash amount of what you're buying, particularly a service that you pay for afterwards like a restaurant.

Which currency is dispensed at ATMs?

As a side-note, it's worth noting that Cambodian ATMs charge a pretty exorbitant foreigner tax. The cheapest that I've found (Vattanac Bank) cost me $4 to make a withdrawal using my UK card, but prices go as high as $7, so you're going to want to withdraw large amounts to avoid paying these fees more often than you have to. If you have a card with no foreign transaction fees, then pay by card as much a possible to minimise going back to the ATM.

With that being said, all ATMs I've been to dispense dollars, with most also dispensing riel. The main difference is that withdrawing in dollars, you're likely to receive your cash in large bills. If you withdraw $200, don't be surprised to receive just two $100 bills. These are too large to be accepted by many smaller businesses, so you'll need to go to a 7-11 or a supermarket in order to break them down into more useful denominations. If you instead withdraw $190 you'll at least get some useful notes.

Common riel bills only go as large as ៛50,000 (which converts to $12.50), so if you go to an ATM and withdraw 800,000 riel ($200), you'll be given your cash in sixteen ៛50,000 bills. These will be accepted everywhere.

The advantage of US dollars

While riel is accepted everywhere in Cambodia, once you cross the border it's pretty much worthless. Even in neighbouring countries you're going to have a hard time finding someone to exchange it, so if you withdraw a million riel at the ATM to save on ATM fees, but then find you only spent ៛500,000 before leaving, you're left with ៛500,000 of souvenirs. Obviously this isn't an issue with dollars that can be exchanged anywhere, and if you're travelling around South-East Asia are useful to keep on hand for paying border guard bribes.

The advantage of riel

The main advantage of riel, or rather the main disadvantage of dollars, is that riel is the official currency of Cambodia, dollars aren't. What that means is that because damaged dollar bills cannot be exchanged at the bank, businesses will only accept pristine dollar bills. They literally have to be perfect. Any slight tear, mark or other damage on your dollars, and you'll find that businesses are unwilling to accept them. That doesn't even mean that pristine bills will be dispensed at ATMs. You can go to an ATM and withdraw $100, pay your $4 withdrawal fee, and be given a damaged bill that no one will accept.

As riel are made in Cambodia and damaged bills can be exchanged at the bank no matter the condition, even if a bill has been torn apart and taped back together, it will be accepted, so it's the much safer choice.

Which currency should I withdraw?

If you're coming from abroad and want to bring some local currency with you (not really necessary as ATMs are everywhere), then you're probably going to be limited to dollars, because it's unlikely you can find anywhere exchanging riel. Once you're here, which should you withdraw?

It really depends how long you're going to be here.

If you're here on a short trip and you want to get a currency that's going to have some value once you leave the country again, withdraw dollars. If you're going to be in Cambodia for a while, get riel. It's the much safer currency in that it's accepted no matter the condition and it's dispensed in smaller denominations. I only withdraw in riel when I'm here, even if it means I have to walk to multiple ATMs to find one dispensing it alongside dollars.

No matter what you start with in your pocket, you're going to have to get used to handling and converting both, so just remember that $1 is ៛4,000 and practice your 4,000 times table.

Common riel bills come in denominations of 100, 500, 1,000, 2,000, 5,000, 10,000, 20,000 and 50,000. Rarer 50 and 100,000 bills do apparently exist, although I've never seen them.