Frugal Travel

A Quick Guide To Finding Currency Exchange Options In Canada

Traveling to Canada might be no different from visiting other destinations.

Just as with a trip to any other country, when you set off for Canada, you need to have your passport extended, your visa stamped, your airmiles credit card used for buying your plane tickets, your suitcase packed with the right set of clothes, and your electronic devices equipped with a plug adaptor.

And just as you do before flying to any other country, you map out your itinerary, make a list of tourist and cultural attractions, and book a hotel, before you head for Canada.

Happy preparations to all countries are all alike. The only element different in these preparations is the currency of the country to which you direct your course.

Were you to travel through several countries in central Europe, united by the same currency, you would not worry about money exchange. In central Europe, one currency fits all.

Canada, in contrast, has its own unique money, printed on polymer plastic, and its own currency exchange options that differ from those available in other parts of the world.

Before departing for Canada, it might make sense, then, to acquaint yourself with its money and banking system so that you exchange your local currency for the Canadian dollar quickly and hassle-free.

First what you need to bear in mind when going to Canada is that its dollar is different from the US dollar in value and looks. The two currencies have been vying for supremacy since the introduction of the Canadian dollar in 1841.

Since then, both have experienced their highs and lows, often changing hands at similar prices, as they sometimes do now. Indeed, gone are those days in 70s of the 20th century, when the Canadian dollar was consistently surpassing the US dollar due to the rise of oil prices.

Nor does the CAD continue trading at premium price of $1.02, as it did between 2009 and 2012 amid mortgage crises. Brought lower by the recovered American dollar in 2013, the Canadian dollar has been trading since below its value. As for now, the USD/CAD pair stands at 1.36.

Not only do the two dollars have dissimilar value, but they also boast different looks. The American greenback consistently flaunts the same color on all banknotes.

Its Canadian counterpart, nicknamed “Loonie” because of the bird loon depicted on the one-dollar coin, in contrast, shows off various colors, from golden to purple. This is not all: even the texture of the two currencies is different.

Unlike the paper US dollar, its Canadian peer is made of polymer plastic. Designed to prevent fraud, the Canadian dollars look glossily stylish but tend to stick together, when they are new. Extra care is thus required when you count out your money lest you give away more than you intend.

The American dollars are sometimes accepted in Canada in the places most visited by tourists. But in the majority of Canadian destinations, you will be expected to pay by the CAD.

If you did not buy some Canadian currency before you left your own country, you will have various opportunities to exchange money, once you land in Canada, though not all of the available currency exchange points offer equally good rates.

The airport and your hotel are, probably, not the cheapest places to buy currencies. It is advisable to go to banks or currency exchange bureau to purchase the Canadian dollars at the better rate.

But beware of the fees they charge. In many places, a fee is added to the exchange rate, because they want to make profit from the transaction. If you have a credit or debit card, you can simply withdraw dollars from any ATM machine.

Often, the exchange rate offered in ATMs is the most reasonable for tourists. To know the exact rate, you should check the so-called mid-market rate, which shows the midpoint between the demand and supply for a currency at the stock market.

Considered the fairest exchange rate, it is easily verified on Google and Yahoo Finance websites.

All major credit and debit cards are accepted in Canada. If you hold a MasterCard, Visa, or Amex, you will have no problems with withdrawing cash form ATMs or with purchasing items in stores or online.

With payments in some large stores, you must be extra careful, however, especially when you are asked if you want to pay in your local currency. This service is called DCC, the Dynamic Currency Conversion, and may look highly convenient at first blush.

As prices in foreign currency may be confusing, it is always easier to orient yourself among familiar money. Yet the problem is that the exchange rate that the Dynamic Currency Conversion offers is always higher than the mid-market rate and, therefore, not profitable.

Opt for paying in local currency in Canadian stores instead. Apart from this issue, using debit or credit cards in Canada is always convenient, since all credit card companies stick to the bank exchange rates.

But do not forget to inform your bank in your native country that you are traveling to Canada.

Some banks get overzealous with regard to their fraud protection and, seeing card transaction made from Canada, may get alarmed and freeze your credit card. You do not need this type of inconveniences on your journey.

You might also want to avoid using traveler’s check on your trip to Canada, since traveler’s checks are already outdated. There are some rare places in the country that might agree to cash your traveler’s check but will ask exorbitant fees for their services.

The majority of the places will simply refuse to accept it. Do not take the risk of getting stuck in the foreign country without money because of the traveler’s check’s outmoded status.

Paying by credit or debit cards in Canada is infinitely safer, and so is withdrawing money from the ATM machine.

Although traveling in Canada does not differ substantially from voyaging in any other country, the information about the Canadian dollar and its exchange options will help you avoid annoying inconveniences, making your visit there easier and more comfortable.

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