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The Blue (Dollar) is the new Black

Pay attention travelers — Argentina’s ‘Blue Dollar‘ is back! This is the most important thing for budget conscious travelers to be aware of when traveling to Argentina.

If you don’t know about the ‘Dólar Blue‘ read on because it can make a huge difference in how much you end up spending on your vacation to Argentina.

‘Blue Dollar’ is an euphemism for the black market exchange for US dollars, which is created by the government’s own policies to manipulate the currency market.

Argentina has a tumultuous banking history and beginning in late 2019 the country’s unorthodox currency restrictions (which most recently existed from 2012-2015) came back with the return of a Peronist party government.

The restrictions place limits on the amount of foreign currency locals can buy, creating a parallel market for foreign currency on the ‘black market’.

Due to the inflationary nature of the Argentine peso, locals prefer to buy and save in foreign currency so that their money doesn’t lose value sitting in the bank.

In what is now being rebranded as the ‘tourist dollar,’ Argentines also pay a 30% surcharge on anything paid with an Argentine credit card abroad.

The restrictions create a huge underground demand for foreign currency, since locals also have no way to get a their hands on any reasonable amount of foreign currency through official channels.

For travelers to Argentina this means that USD, Euros or Reals are worth significantly more cash-in-hand in Argentina than the official government rate given out at banks and ATM bank machines.

 

What the Return of  the ‘Blue Dollar’ Means for Visitors to Argentina

Exchanging currency on the black market is a legal grey area — it’s somewhat of a necessity for Argentine citizens who want to save money or travel outside the country, while being hugely beneficial for foreigners.

But, travelers should be aware that USD, Euros and Brazilian Reales are the only three currencies in demand on Argentina’s black market.

Those planning to visit Argentina who want to exchange money on the black market will probably find it easiest to do so around the country with U.S. dollars.

• Visitors, just like Argentines, will not be able to get their hands on any foreign currency in Argentina, even from their own bank accounts back home. Banks and ATM’s only remit Argentine pesos.

• Cash-only Economy

In practice all this means Argentina is going back to being an cash-only economy for foreigners, because who wants to pay twice the amount using a credit or debit card?

Those who travel to Argentina with foreign cash (USD, EUROS, REALS) can exchange it on the black market, such as on Buenos Aires’ Florida Street and receive considerably more than at a bank or ATM.

• The Current Black Market Rate

As of December 2020, foreign currency is worth approximately 50% more on the black market and this number is only expected to go up as the government increases currency controls.

Background on Argentina’s Blue Dollar

Argentina had a thriving black market for currency under the second term of Cristina Kirchner from 2012-2015, when visitors could get up to 50% more for their cash on the black market.  In the previous ‘blue dollar’ days, Argentina had a reputation as a budget destination. As long as in-the-know foreigners brought foreign cash to exchange on the black market they could enjoy a relatively inexpensive vacation.

Argentina lifted the dollar restrictions and returned to relative normalcy on the banking scene between the years of 2015 until late 2019, while the neoliberal administration of Mauricio Macri was in power.

During these years, there still existed a small black market for currency but the spread between the official rate and the black market rate was negligible compared to now, so foreigners mostly didn’t bother with it.

One of the first moves of the newly-elected Peronist government return to power in late 2019, was to reinstate the unorthodox currency restrictions, bringing the country is back to the ‘blue dollar‘.

Hot Argentina Money Tip (before you travel) : Do not exchange your foreign currency into Argentine pesos before arriving in Argentina. Argentine pesos are a pariah currency — they may not even have any to sell. More importantly, even if they do have them you will get the lower, official rate.

Hot Argentina Money Tip (before you return home): Only exchange the amount you need while in Argentina, and then spend all your pesos before leaving the country. No overseas bank will want to buy them and if they do, they will be virtually worthless.

 

⇒ Before the Blue Dollar was reinstated in Argentina it made sense to use a money service such as Transferwise, but only to save on ATM fees. Unfortunately they use the official exchange rate, so now other options are far superior.

 

Saving Money on ATM Fees in Argentina

With the return of the Blue dollar, budget conscience travelers to Argentina should try not use ATM’s at all.  On top of once again getting a poor official rate for foreign currency, ‘Low Withdrawals limits — High Fees‘ is the name of the game when it comes to accessing money from a foreign bank account in Argentina.

ATM withdrawals are limited to a maximum of about U.S.$82-$200 per transaction for most banks, and only two withdrawals per day are permitted. Crazy, right?

What’s worse is that the low withdrawal amounts are combined with an ATM fee of approximately US$10 or more per transaction. This means that on top of getting the ‘official rate’ visitors who use ATM’s also pay at least 10% just to use bank machines here —and that’s withdrawing as much as possible at a time.

Even when the ‘Blue Dollar‘ market died down during the presidency of Mauricio Macri, visitors sought out alternate options such as money transfer services to access their money from abroad while avoiding Argentina’s high ATM fees.

Considering the difficulty and costs of using banks in Argentina — in addition to getting the official rate — it is understandable that visitors go to the black market to get their hands on some pesos.

While technically ‘illegal’, the black market trade of currency is common in Argentina and there are no cases of foreigners getting in trouble with the law for trading money with a private entity.

Visitors are advised to ask their hotel for a safe place to change their money into pesos.

How to Change Money on the Black Market

It’s best to be informed about the process of changing on the ‘blue market’ before you go. Either ask a local friend to go with you to exchange money the first time to get a lay of the land, or read our article about ‘arbolitos‘ (money changers), ‘Money Exchange and Other Hustles on Florida Street.’

Visitors should also take not not be confused by legal storefront currency exchange houses around the city — their rates are usually similar to the bank rate, so few people use them.

Before going to change money at a cueva, (as the underground exchange houses are known) look up the black market rate on a local website such as Ambito.com, which publishes it on their home page (they call it the ‘dolár informal’).

Many of the exchange houses are on the downtown pedestrian thoroughfare of Florida Street, although they do exist in other areas of the city.

We also help our guests who arrange activities, tours, or travel through this website with recommendations specific locations for safe, reputable place to change money on the black market in Buenos Aires.

There are also private individuals who will come to your home, airbnb or hotel to change money, but make sure to arrange this only with a trusted contact.

Some supermarkets will also take dollars (only larger bills) if you purchase something. They will give you the change in pesos, but be sure to compare the rate they give to the black market rate and the official exchange rate.

 

Using Electronic Transfer Services to Receive Money in Argentina

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So what if you didn’t know about the Blue Dollar and/or are already in Argentina with no foreign currency?

Not all is lost. There are a few money and electronic transfer remittance services that offer closer to the black or ‘informal’ market rate.

Many people use Western Union, as they give one of the higher rates, but their commission averages 10% of the total amount.

A newer service called Remitly operates similar to Western Union but gives higher rates and has lower fees. Their ‘Economy Fee’ is sending from a bank account and the ‘Express Fee’ is for sending using a debit or credit card.

Western Union charges a minimum of $10 for the same service.

 

And the extra good news is, if you use our Remitly link you get a $20 signup bonus while helping this website. Win-win.

Another option (when borders open) is to take the popular day trip to Colonia del Sacramento, Uruguay and pick up some dollars while there.

In theory, Uruguay’s ATM’s issue USD, but it is recommended to take the trip on a weekday because the bank machines usually run out of USD on the weekends.

Using Transferwise to Send Money

Another option, if other money transfer services aren’t an option for whatever reason, is Transferwise, an electronic money transfer service that started operating in Argentina last year.

This new way to transfer money electronically is cheaper for many countries because money doesn’t actually cross borders, but is done on a peer-to peer network.

Their system finds someone looking to transfer money in the opposite direction, and then conducts the transfer using a forex exchange rate, paying out in the local currency.

While Transferwise is great in other countries, unfortunately it doesn’t make much sense to use it in Argentina now hat the ‘blue dollar’ is back.

Their rates are only slightly better than Argentina’s official exchange rate, so the only advantage is that users can avoid paying high ATM and foreign exchange fees.

So the consensus is that Transferwise should only be a last resort, as users will receive only about half of what their money would be worth on the black market or using other services such as Western Union or Remitly.

How to Deal with Money if Staying in Argentina Long-term

The best advice for those moving to Argentina, or even traveling here for any length of time is to bring a lot of cash. Travelers are permitted to enter with up to USD-10k without declaring it.

As a backup, it would also be smart to open a checking account with a bank back home that refunds ATM fees if available.

-In the U.S., Charles Schwab and some credit unions refund ATM fees, while others such as Capital One and USAA refund a limited amount.

-Australians should look into Citibank Plus, an ING Orange Everyday account and Schwab checking.

-Canada doesn’t have many good options for banks that refund atm fees, but try out ScotiaBank/Tangerine-ING or HSBC Premier.

-In the UK most banks do not refund the banking fees, but Nationwide has some of the best rates. The mobile-based Starling Bank is also worth investigating.

Many of the checking accounts that refund international ATM fees have certain requirements, so you’ll have to figure out what works for your individual situation.

Regardless of your home bank, if you absolutely have to use your bank card in Argentina, to get charged as little as possible withdrawing money try to use ATMs that are on your home network.

The Argentine national bank mentioned above, Banco de la Nacion has lower withdrawal fees at its ATMs than the private banks.

Even though there is now the high surcharge on the use of foreign credit cards in Argentina, it is also a good idea to carry a credit card that doesn’t charge foreign currency fees as a backup in case of emergency.

But the previous advice still hold true: Bring cash to Argentina, and if you don’t have cash use a money exchange service such as Western Union or Remitly, which provide a rate closer, and occasionally surpassing, the ‘blue rate.’