(See my "Short" history lesson if you don't know about the current currency situation in VN - it's after my question)
In September, I'm going back to visit family in the USA for a month, and I need to change well over 100 million VN Dong into US Dollars. Where can I change money for the least loss in the transaction?
Because currently no banks will sell large amounts of US Dollars, the only options I can come up with are:
1) Buy US Dollars upon showing my airplane ticket. I heard about this from some colleages. I've tried this successfully once already, at Vietcombank, but they will only change to $500 maximum, and they keep a record, so it can't be done again. When I tried at ANZ Bank, they told me I would have to come back a week before the trip to change up to $500, and so far I've found no other banks that will do this - so it's not a good enough solution for the amount I want to change.
2) Buy Euros or British Pounds, and then change them in the USA for dollars. This option isn't good because other currencies have a much higher price in Vietnam in relation to the dollar that after the fees of changing them to dollars in the USA, I will have lost a lot of money.
3) Buy traveller's cheques. Strangely, some banks in Hanoi will sell these using the current official VND to USD exchange rate - with an additional fee cost of 2% of the amount - and then they can be cashed for USD, again at a percentage fee. This method seems to be the best, as the total loss would be perhaps 4%, but I'm still holding out for a way to exchange that costs less.
Any information or ideas would be greatly appreciated.
"Short" recent-history lesson as background:
If you haven't been reading the news lately, we are experiencing something of "small" currency crisis in Vietnam. About two and a half weeks ago, there was a major run of people buying up US dollars (as well as gold) as a rumor spread there would be a great devaluation of the Dong combined with the continuing high inflation, which would cause a major drop in spending power, as well as major losses of any savings. People wanted to ditch their Dong and get into something considered "safer." Due to that speculation and fear of continuing inflation, the currency exchange black market got overheated, and the result was that the government has effectively put a lockdown on US dollars for any use other than large businesses doing importing. This is because people were trying to hoard USD, and the big selloff of VND wasn't helping the economic situation at all. So, the Vietnam State Bank disallowed all banks from selling dollars to individuals. Go to any bank now, Vietnamese or otherwise, and for the last week and a half, nobody - foreign or Vietnamese - can buy dollars with the Vietnam Dong.
This means that the gold shops for the most part not selling any dollars at all, and if you are lucky enough to find one that is taking their chances with potential severe punishment, the rate is hovering at around 18,000 VND to the dollar. This is a sharp loss compared to even the new all time high price as set by the Vietnam State Bank of 16,621 (the "buy" price of USD as of Friday 13 May.) A quick comparison between local prices of Euro, British Pounds, and Yen will show that the value of the VN Dong is being artificially overvalued when compared to the US dollar. If you peg the VN price of the Euro and then convert to the dollar using the latest world Forex (foreign exchange) rate, you'll find that a dollar should cost about 17,800 - much closer to the black market rate. A quick check on the web searching for "Vietnam currency crisis" will produce all kinds of expert opinions that say the VND will or should be devalued another 15-25% by year's end.
The bottom line of this is that any VND you were paid before (which was likely converted from a USD-based pay scale,) will be worth that much less when the value of VND does finally go down. So if you made $1000 in March, when the rate was 15,800, and received 15,800,000 VND (just forget the taxes for a moment to make it simple,) - then that same money (assuming you haven't spent it) is now worth $950, if you were lucky enough to find a place where you could buy dollars at the official bank rate. If the currency continues to slide down another 15%, to 19,100 VND to the dollar, then that money will be worth $827. I haven't even started to talk about the inflation going on currently, and how everything will also be more expensive on top of that.
The final bit for this lesson is that because of the Vietnamese governments pegging of VND to the dollar, it make buying Euros and GB Pounds and Yen, etc. more expensive when compared to the world Forex rates. So buying Euros and then selling them for dollars would be a losing proposition. It's hilarious that this is the default suggestion that all banks are giving customers after they are told they can't buy any dollars whatsoever.
Option 4: Go native and buy Gold.
Sure you might set off all the metal detectors at the airport, but with the skyrocketing price of the stuff it'll probably go up in value by the time your plane lands.
Canadian Dollars, the exchange rate is pretty good, certainly far lower than for Euros and Pounds, and you can exchange 'em back to greenbacks fairly cheaply at American Banks.
(It's a sad, sad commentary on America's economy that Canadia has a stronger currency than the USA)
I'm going home (US) much sooner than you (next week) so have been going over this dilemma the past couple months. My advice is wait out until at least July or September to see if there's any corrective, reverse action done on the government part. You're lucky if any banks even give u $500 with airplane tix proof. They did this before last year but now EVERYONE (believe me, i've inquired with every imaginable bank in HN) has "temporarily suspended" that service including HSBC who allows it as recently as Thursday.
So where does this leave me? I'm putting dongs in debit account (ACB & Exim have lowest rate) where i'd be charged 2-3.1% when i withdraw in the U.S. But this will be based on current interbank rate set by the international credit card association (some lame acronym I can't remember). This option sure beats paying 17900 to as high as 18500 on the black market.
Lesson learn: Renew my work contract in $ despite the dismal economic situation there.
G'luck, need any other assistance, let me know.
teacherman: Yes, I've considered buying gold, but at the moment, gold is actually overvalued in VN compared to the world rate (though this could change at any time.) Eventually, I want to keep some of my "holdings" in gold, but my main goal right now is getting USD. As for buying and selling CND, I'll check into that, though I expect it may incur the same loss as buying and selling traveler's cheques.
AnhChep: I have heard from a couple of sources already that the government has also locked out the withdrawal of dollars from any VND account, no matter where in the world you are taking out the money. Add to this the extremely exorbitant ATM withdrawal fees - like 30,000 VND from the bank here, and $2-3 more from the bank in USA - and going that route just doesn't make sense, especially for large sums of money.
teacherman: a quick check shows that the Canadian dollar is also overvalued in VN when compared to the dollar. It costs 18045 to buy one CND in VN while in the world market, it's only 16140. That price is almost 11% higher, which would result in a terrible loss of money, especially when exchanging back to USD.
To be clear to anybody reading, here are the ratios of dollar to other currencies here in VN compared to the world exchange rate (as of Friday, 13 June):
Crncy in VN World rate
USD 1.00 1.00
CND 1.085 0.9714
EUR 1.6542 1.5393
GBP 2.0862 1.9467
JPY .00992 .00924
So, you can see all currencies cost quite a bit more in VN when compared to USD.
As an aside,
1) Why is Vietnam, and the Viet Kinh, so obessed with yet another devaluating currency, the US $ dollar? Thanks to El Presidente Bush, the American economy is rapidily flushing itself down the toilet, along with its currency.
Why not tie itself to a stronger currency like the Euro or the Chinese Yuan?
2) For the George Soros among us, there is currently a wide open opportunity to make some bucks for those with large stacks of US $ on hand. Viet kinh and foreigners alike will pay anything to get their hands on US dollars at the moment.
Alas, I am just a poor ass English Teacher.
It seems like it would be a time to make some money, except that you might end up with a lot of dong and no way to convert them to dollars, right?
I've been tripping out about this difference between the official 16,500 and black market 18500 rates too - I'm just worried things will be crazy by the time I move to Vietnam in late August.
"I have heard from a couple of sources already that the government has also locked out the withdrawal of dollars from any VND account, no matter where in the world you are taking out the money."
Does this include telex transfers and / or bank drafts? So you cannot transfer the money out of the country? That's what I was going to suggest but perhaps you can't do that either.
Hmm. Feeling very fortunate that my salary here in VN is paid in USD and not VND.
I'm not sure if people are still following this thread as it's off the "recent" list on Ask a New Hanoian, but here's my update:
Vietcombank, at least the one at the end of Ba Trieu (near Bach Khoa University,) will change VND up to the equivalent of $500 USD at the current (buying USD) exchange rate, no extra fees - IF you a foreigner with a plane ticket for an international flight out of Vietnam (it's okay if you also have a return flight to Hanoi.) You must take a number when you enter the bank, and wait like everybody else, and then show your passport and plane ticket. They will record the transaction, so you can only do it ONCE per ticket/trip.
A good Vietnamese friend of mine said his friend who works at Vietcombank said both foreigners and Vietnamese nationals alike should be able to change up to $700 each if they show a plane ticket, and then higher amounts if the person has a Vietcombank account. I haven't been able to verify this yet.
Finally, Vietcombank will buy American Express traveler's cheques which are in USD denominations, up to any amount, but at least $2000 for sure - and give you cash USD. One person at my work heard that you can go to the same Vietcombank location I mention above, and then on the 2nd floor, there is one teller window which will provide this service. However, they charge 1% of the total that you are changing into cash. My colleague told me they only required his passport, but I'd recommend having other paperwork showing where the cheques were bought, and maybe even where you got the money in the first place to buy them. I recommend this because of my experience at ANZ Bank buying AMEX traveler's cheques (see below.)
ANZ Bank (on the west side of Hoan Kiem Lake) will change VND to up to $500 USD like Vietcombank, EXCEPT they will only do it within ONE WEEK of your departure date on your international flight plane ticket. My flight isn't until the end of August, so my attempt to change money failed. However, they also told me that my wife, who is a Vietnamese national, will be able to change to $500 herself with her plane ticket in hand one week before the flight. Strangely enough, I was able to buy AMEX traveler's cheques on my third visit to ANZ...
You can buy up to $7000 USD worth of AMEX traveler's cheques at ANZ, but there are some caveats. First, you must have a plane and international flight plane ticket with a departure date within one week of the current date (I'm not sure how I got around this, but maybe I was just lucky.) More importantly, you need to have paperwork that shows WHERE the money came from, eg., showing that you earned it from working, and also where you withdrew it from before, if you did that. This may involve a letter from your employer stating you are paid in cash, along with copies of your work contract and pay/tax slips. Or you may need an official bank transcript where your salary is automatically deposited showing you received and withdrew the same amount of VND that you are looking to change. I know these things may sound ridiculous, but I think the bank's "hands" are tied as it were by the VN State Bank. The reason for the $7000 limit is that you must declare more than $7000 at customs when leaving Vietnam to an international destination. A colleage at work told me that theoretically you can buy any amount of traveler's cheques, as long as you don't take more than $7000 out of VN.
That last bit on ANZ is that a Vietnamese colleage's husband is currently in the USA, and he is apparently withdrawing USD at ANZ Bank in the USA from their VND-based ANZ account here in Hanoi. There are considerable fees and limits to each transaction, unfortunately.
I have not heard of any other banks in Hanoi allowing the purchase of USD cash or traveler's cheques besides Vietcombank and ANZ. As for transferring USD out of Vietnam, you can do that all you like, as long as you bring USD cash to transfer to a USD bank account in another country. You CANNOT send VND electronically by any means to a foreign USD-based account, that I am aware of.
I hope this helps. If people are still reading, I'll ask the question of: Should we start a new thread on this subject?
does anyone know the current situation on changing dong into dollars? I'm paid in Dong and would like to change a certain amount every month into dollars to pay my landlady the rent.
Right now the rate is 17100 VND to $1. My landlady wants me to pay in dollars and her black market rate is at 18,470 which is a rip off considering I owe her several million dong.
@duggboy, damn ugly AV but fully understand.
I use http://www.xe.com/ucc/full/ for this. Halfway between buyers and sellers rate and that's it. Fixed.
The demand for USD shits me. Especially the "this notes no good...". Over it. Put your foot down and if it's not fake then tough luck.
USD is illegal here for local payment contracts, as we all know very well.
I have a local (ANZ) USD account so I take out about 75% of the dues and make up the rest in Vnd. At the going rate above. Final, done, they cannot argue. Above is a really fair rate.
the way they set the rules heree regarding currency transactions and money, anyone would think it was a sovereign country rather than an asian theme park setup to allow Westerners to make money by pretending to pass on languages while living the low pressure, low stress 'I'm on an extended 5 year sabbatical from life' good life...
Or am I being too cynical and sarcastic?
That said, when I opened my account at HSBC and they told me if I was paid in USD it would be simpler for me to be able to get USD out of the country, I was straight onto my employer asking if I could be paid in USD please (no luck tho!)
Personally, I'm thinking it's going to be awkward proving I've earnt the money and paid tax on it when my employer seems to want to avoid all forms of documentation ... even my employment contract doesn't have the name of the company on it!
so maybe I'll have to buy a car when my time is up, then drive it to Thailand and sell it (how much is the import tax on a BMW X6?) :)
just my 50 cents...
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