Money in the United States: Banks, ATMs, cards & currency exchange

This guide will explain American currency, where to get money, and how to spend it in the US. Read on to make sure you have the essential facts about money in America.

Currency in the US

The official American currency is the dollar.

Some areas in the U.S. near the Canadian border may accept Canadian money. However, in general, you should only use US dollars, as you'll be charged unfavorable exchange rates when not paying in USD. Other foreign currencies aren’t accepted.

Characteristics of the U.S. Dollar (USD)

|--- |--- |
| Names & Nicknames | U.S. dollar, American dollar, dollar & cents, ‘buck’ |
| Symbols & Abbreviations | USD, US$, $ |
| 1 USD | There are one hundred cents in one dollar. |
| USD coins | Money worth less than $1 is minted in coins. You’ll find denominations of 1, 5, 10, and 25 cents. You’ll also find dollar coins and half dollar coins, but they’re rare. The half-dollar is a collector’s item. |
| USD banknotes | The United States prints banknotes in denominations of 1, 2, 5, 10, 20, 50, and 100 dollars. All of these bills are widely used in wide circulation, except for the 2-dollar bill. It’s legal, but is almost never seen. Recently, many paper bills have been printed with additional security mechanisms like microprinting, colouring and larger designs. If you're returning to the U.S. with old bills, your local bank may be unwilling to exchange them for fear of counterfeiting. |

Exchanging currency in the US

When it comes to exchanging your money for dollars, you’ve got options.

The ATM is usually the best choice. ATMs will use the interbank exchange rate. This rate is the midpoint between the buy rate and the sell rate in global currency markets, and so you can rely on it being the ‘truest’ rate.

If you’re looking for options beyond the ATM, you’ll find currency exchange desks in airports and hotels. The convenient location comes at a price though, since they tend to mark up the dollar exchange rate and charge hidden fees. You also run the risk of them refusing any torn or damaged bills.

As the dollar is a widely-circulated currency, your home bank can probably handle your currency exchange ahead of time, so you can arrive in the States with your dollars in hand. If you need further exchange services, you'll probably find an American bank that partners with your home bank. Partner banks waive foreign transaction fees and won’t tend to charge you a withdrawal fee.

Traveller's cheques in the US

Traveller’s Cheques used to be the safest, most common way to bring money abroad. However, the ATM has now rendered them inefficient. Cashing a traveller’s cheque is time-intensive. It requires a verification process at a bank or a shop. Also, traveller’s cheques offer poor exchange rates.

These days, traveller’s cheques are rarely used, so it’s not cost-effective for banks to process them. You might have to visit a few different locations, just to find one that cashes your cheque.

If you feel unsafe using ATMs or banks abroad, order a prepaid debit card instead of a traveller’s cheque.

Using credit cards and debit cards in the US

All major credit and debit providers are accepted across the US, and many of them are based in the States. No matter your bank, you should be able to use your home card in most places. Even cards from smaller providers are likely to be accepted. Just remember to tell your card issuer that you’re going abroad, so they don’t freeze your account for suspicious activity.

In the US, the credit card is king. Visa, MasterCard, and American Express are the most commonly accepted cards. Check out their fees on foreign exchange, so you’re apprised of what you’ll be spending. Sometimes you're better off using one card over another.

Smaller stores and cafes will often forbid you using your card unless you spend a certain amount. It's uncommon, but not impossible, to find places that are ‘cash only.’ Keep small bills on you at all times for tips, quick purchases, tolls and transportation fare.

Always select ‘Withdraw in dollars’ as opposed to withdrawing in your home currency at ATMs. Otherwise, you give the ATM permission to mark up your exchange rate. This is called ‘Dynamic Currency Conversion’, and it usually means you’re going to be charged needless fees.

ATMs in the US

There are more than 425,000 ATM machines across the US. 48 percent of these machines are owned by financial institutions, and 52 percent are owned by independent deployers. Those owned by independent deployers are often found in grocery stores and small shops, or along busy streets. Expect to pay extra withdrawal fees at these ATMs.

For lower fees, or at least a more transparent fee structure, search for ATMs connected to post offices and large retail banking institutions. For advanced planning, use an ATM locator to find your bank. Click to find the locators for MasterCard, American Express, Maestro, and Visa.

Banks in the US

Many of the world’s largest global banks are American. For this reason, you’ll have no trouble finding retail bank branches, pretty much wherever you are. Be it city, town or countryside, financial infrastructure in the US is sophisticated. If you bank with a global bank, chances are you’ll find a branch or a partner in the US. The “Big Four” banks hold 39 percent of all consumer deposits across The States.

The following are the largest principal banks with retail operations in the US:

Major Retail Banks in the United States

• JP Morgan Chase Bank
• Bank of America
• Citi (or Citigroup)
• Wells Fargo
• PNC
• Capital One

Most foreign banks maintain branches in the US. Here’s a list of the largest and most widely accessed:

International Banks Operating in the United States

• HSBC (USA)
• TD Bank (USA)
• RBC Bank (USA)
• Santander Bank (USA)
• Industrial and Commercial Bank of China (USA)
• BNP Paribas (USA)
• Mitsubishi Bank
• Credit Agricole
• Deutsche Bank (USA)

Alternatively, for simple access to the money you need while you’re abroad - and an even better deal - use Wise.

If you have a bank account in the United States, or know someone who does, you can transfer money between bank accounts using the real mid-market exchange rate. It's a convenient way to get your cash, with no hidden fees.