Best ways to spend travel money in Sri Lanka

Low-cost travel money options for Sri Lanka

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Using credit cards

A credit card is one option to consider when travelling in Sri Lanka. Like all travel money options, it has its benefits and drawbacks. Consider some of the following factors associated with using your credit card overseas:

• Currency conversion fees. Most UK credit cards will charge a currency conversion fee of around 3% if you use your card to make purchases in a foreign currency. To reduce your expenses, look for a credit card designed for overseas use that doesn’t charge these fees.
• ATM withdrawals. Credit cards aren’t designed for cash withdrawals, so you’ll probably accrue a high cash advance fee if you use your card for ATM withdrawals in the UK or overseas. As you’re most likely to use cash in Sri Lanka, you may want to consider carrying a debit or prepaid card for cash withdrawals and leave your credit card for large or emergency purchases.
• Interest. If you don’t pay off your balance in full each month, you’ll usually be charged interest which can quickly become expensive. Using your card for cash withdrawals incurs interest from the date of the transaction – even if you clear your balance in full that month.
• Acceptance. Visa and Mastercard are widely accepted in Sri Lanka, so you should have no problem using this type of card while you’re travelling.
• Rewards. Some credit cards are linked to a rewards or frequent flyer program, which could be a smart way to earn points on your holiday purchases. Some cards even offer bonus points for overseas transactions.
• Insurance. Credit cards designed for overseas use often come with complimentary travel insurance for you and the family members travelling with you. You may be required to pay for a percentage of your travel costs with the card to qualify, so make sure to read over the insurance policy.

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Using prepaid travel cards in Sri Lanka

You can load pounds on to a prepaid travel card, which can be transferred to multiple supported currencies. Here are some of the benefits and drawbacks you should consider:

• Supported currencies. A small number of UK prepaid cards support LKR, so you’ll hopefully be able to avoid currency conversion or foreign transaction fees if you use a compatible travel money card in Sri Lanka.
• ATM withdrawals. Travel cards charge different ATM fees depending on the currency you’re withdrawing. You can check the review page or product disclosure statement (PDS) relevant to your card to see how much ATM visits will cost you.
• Locked-in exchange rates. Prepaid travel cards lock in your exchange rate at the time of loading the funds, so your money is protected against negative exchange rate fluctuations while you’re travelling.
• Access to your own funds. Unlike a line of credit, a prepaid card carries preloaded funds from your current account. This can help curb overspending and give you a more realistic understanding of your travel budget when you’re overseas.

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Using travel money debit cards

Debit cards can be a good way to access your current account balance overseas, but there are some drawbacks you need to be aware of. Consider some of the benefits and restrictions below:

• ATM alliances. Some UK debit cards belong to ATM alliances, so you can withdraw funds from specific ATMs overseas without incurring a withdrawal fee. Some card providers also won’t charge for using your card overseas.
• Currency conversion. Unless your card is designed for overseas use, you’ll be charged a currency conversion fee if you use your card to make purchases in a foreign currency.
• Use your cash. A debit card only has access to your current account balance. This can help you keep your travel budget in check and prevent you from overspending as you are not using credit.

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Taking cash into Sri Lanka

It’s prohibited to bring more than a small amount of LKR into and out of Sri Lanka. At some point, you will need to get money changed or make an ATM withdrawal.

What’s the alternative?

Digital banking apps are definitely worth considering. You can use them to manage your travel money anywhere in the world, and many don’t charge any transaction or withdrawal fees.

What currency can I use in Sri Lanka?

The official and only currency of Sri Lanka is the rupee (LKR). The Sri Lankan government has tight control over the national currency and there are strict limits on the amount of rupees you can bring in and out of the country (up to LKR 20,000 – which is around £50). You’ll need to change pounds to LKR or withdraw rupees from an ATM when you arrive.

How many rupees should you bring on your trip?

Colombo	Budget	Mid-range	Expensive
	Simple guesthouse £10–£25 per night	Double room in a 3-star hotel £35–£80 per night	5-star hotel £85 and above – per night
	Fish curry and mixed rice £0.70–£2	Meals at hotel/restaurant £7–£13	Meals at top-end places £15 and above
	Bus fares £2-£4 per day	Hire bikes, ride trains and use a car and driver some days £14 per day	Daily use of car and driver £35-£50 for a day

Exchange rate history (GBP to LKR)

Should it be a travel card, a credit card, or a debit card?

Are you travelling to Sri Lanka and looking to find the best way to take your travel money? Let’s compare prepaid travel cards, credit cards and debit cards to help you determine which option is right for you.

Most digital banking apps, which are a great option owing to very low transaction and withdrawal fees, come with either a Visa or Mastercard bank card. They work as normal bank accounts do, so the “topping up” process simply consists of transferring money into the account.

A quick summary of your travel money options in Sri Lanka

_{This table is a general summary of the travel money products in the market. Features and benefits can vary between cards.}

Get familiar with the Sri Lankan rupee

The Sri Lankan rupee comes in the following denominations: 1, 2, 5, 10, 50, 100, 200, 500, 1,000, 2,000 and 5,000. 10 rupees is the lowest denomination banknote.

Exchanging money

You should wait until you arrive in Sri Lanka to get the bulk of your money changed. Money exchange offices in Sri Lanka can change pounds to rupees. You can bring up to LKR20,000 to Sri Lanka from abroad, which is approximately £50, or you can bring up to the pound equivalent of US$15,000 without declaring it.

LKR is a minor international currency. Exchange offices in the UK charge a higher commission compared to getting your money changed when you arrive in Sri Lanka. Exchange offices at Colombo and Hambantota airports offer rates that compete with what you can get on the street, so don’t be afraid to get your cash changed as soon as you get off the plane. Exchange offices at Colombo airport are open 24 hours a day, 7 days a week.

Licensed money changers such as jewellers and designated exchange offices may offer a better rate than banks. The rate may change depending on the denominations you want to change. For example, you may be able to get a better rate exchanging £50 notes compared to multiples of £10.

Hotels and street money changers

If you can, avoid changing money at your hotel. Hotels usually offer a worse rate than banks and dedicated money changers, and a commission may also be applied to the transaction.

Street money changers may offer an attractive rate, but there’s a higher chance of being ripped off. These people are practised at sleight of hand and have been known to short-change tourists. It’s better to be safe than sorry and get your money changed at the airport or at a bank. Spend a few extra pounds to ensure you end up ahead.

• Tip: Be sure to keep your exchange slip when you get money changed so you can re-exchange cash when you leave the country.

Withdrawing cash from an ATM

The other option to get LKR is to withdraw cash from an ATM when you arrive. Cash withdrawals using your credit card (not recommended) or debit card are subject to the Visa or Mastercard foreign exchange rate. The Visa and Mastercard rate is close to the interbank rate. The downside is that a local ATM operator fee and international ATM fee may apply.

The banks to use to withdraw cash

Not all banks accept foreign cards. You can make cash withdrawals using your UK card at these popular Sri Lankan banks:

Make sure you check to see whether the ATM takes your card. The Visa and Mastercard logo should be displayed on the front of the machine.

Bottom line

There is no single best travel money strategy, as the right one will ultimately depend on where you’re travelling, how you’re spending your money and what you can afford. For example, if you’re going to be making a lot of cash withdrawals, consider a debit card with an ATM alliance or a prepaid card with low withdrawal fees over a credit card.

Given Sri Lanka’s relatively strict limits on the amount of physical cash that can be brought into or taken out of the country, it may make sense to wait until you arrive in the country before trying to get your hands on LKR bank notes.

As LKR is a relatively minor international currency, you’re unlikely to find overly competitive exchange rates if using an exchange office in the UK to get LKR cash. UK-based exchanges are also likely to levy a higher commission, when compared to getting your money changed as soon as you arrive in Sri Lanka.

Frequently asked questions

• How can I send money to Sri Lanka from the UK?

  You can easily send money from Australia to Sri Lanka using an online money transfer service. We answer this question in more detail in our guide to transferring money to Sri Lanka.

• What’s the best way to get LKR in Sri Lanka? Cash or card?

  If you’re asking whether it’s better to take pounds to change when you arrive in Sri Lanka or make ATM withdrawals, it depends on the card you use to make a withdrawal and ATM fees vs the exchange rate on offer plus any commission.

• What’s the best place to exchange cash in Sri Lanka?

  You have a couple of options. Hotels, licensed money changers, street exchange vendors and banks may accept pounds, though USD or AUD can be safer options. Hotels can be convenient, but you’ll pay more. Banks and licensed money changers are a safe bet. These places usually offer a rate somewhere in the middle in terms of value for money. There are exchange offices at the international airports where you can get your money changed 24 hours a day, 7 days a week.

• When are banks open in Sri Lanka?

  Most banks are open 9am–1pm, Monday to Saturday. Banks in the city may stay open until 3pm. Some services at some banks are available 24 hours a day.

• How much can I withdraw from an ATM in Sri Lanka?

  ATM limits in Sri Lanka vary depending on the ATM provider. Some ATMs can dispense up to LKR40,000–LKR80,000 at a time. Limits may be higher, and you will be advised about transaction limits when you insert your card into the ATM. You can make multiple withdrawals up to your bank’s maximum daily withdrawal limit.

• What do I do with my leftover LKR?

  There are restrictions on the amount of LKR you can take out of Sri Lanka, so you should get any leftover rupees changed to another currency before you leave the country. You can do this in the departure lobby of the airport before you board your plane. You should have been provided with an exchange slip when you first changed your money to LKR. Show this slip to get your money changed back before you leave the country.

• How much should I tip when I’m in Sri Lanka?

  A tip can be a great way to show your appreciation for a job well done. It’s not compulsory to tip, but there is some expectation of a reward for most direct services such as room cleaning, carrying bags, drink and food service and guided tours. An additional ‘service charge’ is included in some bills, like when you dine out at a restaurant or when you settle your hotel bill. This additional charge is collected by the owner of the business and the money may not end up in the hands of the people who have served you. Tip waiters, cleaners or staff directly to make sure they get the money.

  Guidelines for tipping:

  Tip restaurant and bar staff and drivers 10% of the total bill, 100 rupees a day for cleaners and 50 rupees (per bag) for porters. If you’re visiting a temple or shrine, tip shoe minders 20 rupees. Island car tours will expect a little more, but it’s your decision to tip as much as you feel is necessary to show your gratitude for a service well (or not so well) done.

Written by

Jason Loewenthal

Senior writer

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Jason is a writer and editor. He worked as a senior subeditor for Finder for 5 years and in that time became familiar with a wide range of financial products and services. Before that, he worked for Australian Associated Press. He has a BA from Macquarie University in Australia. Jason loves to help other people find new ways to save money. See full bio