The FINANCIAL -- International travel, whether for business or pleasure, carries with it an inherent need for preparation. One of the biggest concerns for the unseasoned traveller is how to obtain the different types of currency that need to be used in a foreign country. The simplest solution is not always the best for your bottom line when it comes to fees and the possibility of being scammed. There are several ways to exchange currency, as outlined below.
Currency exchanges at kiosks
Currency exchange is important as far as it plays a key role in international trade. There are several options for currency exchange: banks with current rate; forward contracts and futures contracts. Unfortunately, futures contracts do not exist in Georgia due to the absence of a currency market. Private exchange offices play a solid role in the exchange market, as far as they are calculated at the masses. Accordingly, we receive lower bid-ask spread. As for risks, we should consider that exchange offices are regulated by the National Bank of Georgia and are a subject of registration. However, some risks do exist. Several years ago there was a precedent that at exchange offices it was announced with small shift that they offer exchange with a 5-10% commission fee. An attractive spread made them exchange currency and finally lose quite a solid sum on spread. Such offices soon quit the market. However, the fact of this precedent remained. Currently any exchange office is obliged to provide an official document allowing them to exchange (such a document is important for legal entities).
Converting at airports and hotels
Contrary to exchange offices, airports and hotels are not using forward contracts. Accordingly, cash settlements are riskier for them. The low volume of exchange here is also an important factor in this regard. Considering these aspects a person should not use the exchange service of private exchange offices if there is not an urgent need to do so. Take into account that representatives of commercial banks are located at the majority of large hotels. Accordingly there is no difference in rate and customers can relax due to the absence of potential risks.
Exchanging your budget fully or separately
We all know that while planning a trip a tourist considers their budget in advance in their own currency. I would suggest not converting one’s entire budget immediately. First of all visitors should adapt to the local market. One should divide their planned budget between 30 and 70%, as in the beginning you can correct your budget and spend it more efficiently.
The best day of the week for converting money
My suggestion is a bit personal and cemented with rather perfunctory arguments. Although, considering the existing trend, the second half of Monday is the best time to purchase Georgian Lari. At that time we see the mass selling of international currencies at auction which have accumulated over the weekend. In addition, legal entities find it more profitable to make transactions on Monday, because of one reason - closing the deal of cashbox during the whole week.
Why converting is better than card payment
There is one simple reason which supports converting rather than card payment - cashbox turnover is made due to the exchange rate of the card issuer bank. Cash financial resources with card, either credit or debit, is crucial. First of all it protects one from unexpected expenditures. Although, the majority of shops and HoReCa places offer card payment in Georgia, purchasing with the national currency remains uncontested. In order to get a complete experience of the country, purchase souvenirs and enjoy communicating with local people, the best way is to trade in the national currency.