Money in Dubai: Banks, ATMs, Cards & Currency Exchange

The most populous city in the United Arab Emirates, Dubai, is also one of the Middle East’s biggest business hubs. One reason that Dubai attracts people from across the world is that the city has a 0% income tax. Yep, you heard correctly. Dubai dwellers, now numbering 2.7 million people, can pocket all of the cash they earn.

Not surprisingly, the city is developing rapidly as a result, with 20% of the world’s construction cranes located there. Currently the world’s biggest mall, tallest hotel, and largest aquarium are already situated in this stunning city. Visitors not on a budget can also stay at the world’s only 7-star hotel, the Burj al Arab.

What’s the currency in Dubai?

The United Arab Emirates (UAE) Dirham, usually known as the Emirati Dirham, is the official currency of the UAE. Introduced in 1973, the currency replaced the Qatar and Dubai Riyal. Officially the currency is abbreviated as AED, but DH and Dhs are also used unofficially. It’s divided into 100 fils, which is a modern retranscription of Fals, a medieval Arabic coin.

If you were looking to use cash from back home in Dubai, you won’t have much luck. It’s pretty uncommon to pay for goods and services in Dubai with any currency other than the Dirham. However, International credit and debit cards, such as Visa and Mastercard, are widely accepted at retailers. ATMs are situated nearly everywhere, and foreign debit cards can usually be used in order to take out cash. You can also exchange cash at several locations. But we’ll discuss that later.

What should I know about exchanging money in Dubai?

Foreign visitors to Dubai can exchange their currency both at banks and currency exchanges.

Find an exchange service that offers you fair rates

When in Dubai, keep in mind that you’ll find the best rates if you’re exchanging from US dollars, as the AED is pegged to the dollar. So you’ll receive roughly the same rates (after factoring in added fees) when converting from dollars to dirhams.

Here are some of the best spots in the city to swap cash without losing much.

• Travelex
• Al Ansari Exchange
• Al Ghurair Exchange
• Al Fardan Exchange

Often, exchange places, especially at airports and hotels, will attempt to woo customers by advertising their favorite phrases: “0 fees” or “No commission”. But what you see usually isn’t what you get. If you do a quick Google search or use an online currency converter, you’ll discover that your money is worth much more than an exchange bureau or bank is offering you.

The real rate, based on daily trading that occurs at banks and large global finance markets, is referred to as the mid-market rate. This represents what your money is actually worth. Banks and exchange services, however, will often make up their own, much poorer exchange rate and then pocket the difference.

Figure out if rates are better in Dubai or your home country

Sometimes it makes the most sense to convert your cash from your home bank before you go abroad. Other times, however, you can snag a better deal abroad. Through websites such as finder.com, you can compare and contrast the exchange rate of several services at home and in Dubai.

Avoid exchanging too much cash at the airport or your hotel

Airports and hotels have a monopoly over you, charging higher prices due to a shortage of alternative suppliers. Try to exchange only a small amount - such as what you’ll need before reaching an exchange center with a more cost-savvy rate. Your bank account will thank you later.

Ensure your banknotes are damage-free

If you’ve brought cash with you from back home, make sure those bills in your pocket are in good shape. In Dubai, most merchants will refuse to accept any sort of damaged banknotes to exchange. Banks in Dubai will typically take damaged dirhams from their customers, sending them back to a central bank which replaces them.

If you know someone with a bank account in Dubai, transfer money ahead of time for even better savings

With a Wise account, you can transfer to a bank account in Dubai conveniently and at a low-cost. Additionally, you’ll always get the same rate you see on Google when you convert money within your account, which will help you save money.

Can I use travellers cheques in Dubai?

You can, but it’s not really worth it. Most shops and restaurants in Dubai won’t accept them, but it’s easy enough to exchange them at banks, exchange offices, and hotels, for a much less favorable exchange rate. It’s much better to simply use cash or a debit credit card if you can, which are much more likely to be accepted in Dubai.

What should I know about using my debit and credit cards in Dubai?

Major providers such as Visa and Mastercard are widely accepted at major restaurants, stores and hotels in Dubai, with other cards such as American Express less likely to be accepted. However, not all smaller stores and grocery shops will accept your card. So take caution, and take cash along with you while you’re there.

Always choose to be charged in the local currency

The good news is that several ATMs in Dubai are free to use, especially those of major banks such as Citibank and HSBC, or any bank that’s a member of the Global ATM Alliance.

On the flip side, when you make purchases with your card, or withdraw money from an ATM, you might run into Dynamic Currency Conversion (DCC). The card merchant or ATM will ask if you’d like to be charged in your home currency rather than the Dirham. It might seem a bit more convenient to do the transaction in a currency you’re more comfortable with. But be warned: you'll be marked up in price, sometimes at four or more percent, just for the convenience of seeing the numbers in your home currency.

With DCC, you’re granting the local ATM the right to give you whatever exchange rate they feel like, which usually isn’t in your favor. You’re better off doing transactions in the local currency, where your home bank will give you a much better exchange rate, and save you a lot in the long run.

Don’t forget to tell your home bank you’re going to be travelling

It’s happened to many of us. We forget to tell our banks we’ll be heading abroad, and attempt to pay for something with our cards from back home when we arrive. But then we’re told the card has been declined. Don’t let this be you: before you land in Dubai, remember to give your bank or card issuer a heads up you’ll be heading overseas. Otherwise they could think there’s suspicious activity taking place and lock your card.

What are the best practices for using ATMs in Dubai?

A global finance capital, ATMS are found nearly everywhere in Dubai. As long as you have a 4-digit pin number for your card, you can typically withdraw from accounts there.

Still, be sure to watch out for offers to be charged in your home currency rather than the local one. If you see the option, always select to be changed in euros to avoid steeper fees added into poor exchange rates.

If you’re on the lookout for an ATM near you, the website Bankautomat Finder allows you to easily locate ATMs throughout the city.

What are the major banks in Dubai?

Most common retail banks in Dubai

There are several banks operating in Dubai, many with international branches. So if you aren’t sure if your home bank has a branch, it’s worth investigating if they may have a partner in Dubai, which could help reduce overall ATM fees if you find there’s one.

• Arab Emirates Investment Bank - a boutique bank specializing in both private and investment banking.
• Commercial Bank of Dubai - founded in 1969, this bank launched the first online personal finance tool in the region.
• Dubai Islamic Bank - a longstanding bank offering services such as wealth management, in addition to retail banking.
• Emirates Islamic Bank - Offers many branches and ATMs around Dubai
• Mashreqbank - Founded in 1967, it's the oldest bank in the UAE and the first to offer ATMs
• Emirates NBD - Has more than 220 branches in Dubai and abroad
• Noor Bank - Offers several services in Islamic banking for retail and corporate clients

International banks operating in Dubai

With a diverse international population, it comes as no surprise that Dubai caters to it’s inhabitants with a broad selection of international banks. Among the larger ones are:

• ABN Amro Bank UAE
• Al Khaliji S.A.
• Arab African International Bank
• Bank of Baroda UAE
• Barclays Bank
• Blom Bank France
• Citibank
• Commerzbank
• Crédit Agricole Corporate and Investment Bank
• Credit Suisse
• Habib Bank
• National Bank of Abu Dhabi
• UBS

No matter how long you’ll be in Dubai, you shouldn’t have any problem exchanging and spending your money.