Argentina is one of the few countries that tries artificially controlling the foreign exchange rate and has completely failed.
There is an official exchange rate that you can use to convert currencies to local pesos, but you cannot use the official rate to convert pesos to foreign currencies, and this has created a vast black market called Dolar Blue.
You cannot get cash from the local ATMs using a competitive rate, but only the official one that currently (April 21) sits around 1 USD = 218 ARS.
If you use a foreign-issued credit card to pay, however, you get a semi Blue Rate of around 395 pesos per USD (Visa calculator), when the Dolar Blue rate is 432 pesos per USD.
Your hotel charges are tax exempt (21%) if you use a foreign credit card to settle, so you no longer need to exchange USD to ARS to save on accommodation, as the VAT savings are more significant than the spread between the Blue Dollar and the foreign credit card exchange rate.
I don’t usually suggest anyone use a Western Union, but they also offer a convenient service if picking up ARS at a competitive rate and funding it using a credit or debit card.
Money Exchange in Buenos Aires
The “official” exchanges either don’t show exchange rates or the official ones with a better rate for tourists.
You should not use them; you can get a much better rate elsewhere.
Just walk around Calle Florida, and every few meters, there is a person or two offering foreign exchange services, mainly from dollars, euros, or reais to Argentinean Pesos.
You should always check the latest exchange rates for Blue Dolars, and several websites are tracking them (you can access some of them here, here, here, and here).
You pick up one of the persons and start to negotiate. If your bills are crisp $100 ones, you should get close to the blue dollar rate shown on one of the websites.
You then walk with your handler to one of these “illegal” exchanges all over the center, usually in an unmarked shop.
You hand them your dollars, and soon the cash-counting machine goes through the stack of notes you will end up with. I have never been given an incorrect amount or fake notes from these places. I did not exchange my $20 notes, as the rate offered for them was not good, and it was a wise choice.
I didn’t get through the 158,000 ARS from the first exchange, and the ARS devalued over the week against the dollar by 8%.
The restaurant bill above would have been $160 using the official exchange rate, $97 by settling using a foreign credit card, or $89 using ARS from the Blue Dolar exchange.
Previous Dolar Blue Coverage:
- Dollar Blues In Argentina (Bring $100 Notes & Don’t Use Cards)
- Report From Buenos Aires: TO BLUE OR NOT TO BLUE (OR HOW ARGENTINA CAN BE 33% CHEAPER
- REMINDER: Exchange Cash Locally In Argentina & Save 33% (DON’T USE CREDIT CARDS!)
- Dolar Blue Take Three: Reminder To Exchange Cash Locally In Argentina And Not To Use Credit Cards
- REMINDER: Take Cash To Argentina And Not To Use Credit Cards (Dolar Blue)
- Argentina Lifts Currency Controls – Dolar Blue Gone For Now?
- Argentina In Crisis – Dolar Blue Makes A Return?
Conclusion
The exchange rate of USD to ARS was 1 to 3 when I was in Argentina for the first time, and now it is 1 to 427. The current largest note (1,000) is soon worth $2, and the 500 peso one a buck. You need stacks of notes to pay for any significant expenses.
Not sure why the country’s government has this silly practice in place. Who do they believe they can mislead by having essentially an exchange rate nobody uses and then these Blue Dolar and foreign credit card ones?
It is excellent that you can now pay hotel expenses using a foreign-issued credit card and do better than the blue rate because the 21% VAT is waived. You only need to bring cash to cover other expenses. This saves you around 10% to 15% over paying using a card, as long as these two rates move hand in hand.
I will update you about using a credit card to pay in Argentina and how this also affects earning points for hotel stays when all these charges have cleared and stays posted.