Following the Republic of Cyprus’ EU accession on 1st May 2004, it’s thought that southern Cyprus will adopt the euro (€) in late 2007 or early 2008.

At present, however, Cypriot currency is the Cyprus pound (CY£), which is divided into 100 cents. Although it isn’t traded internationally, it’s a strong, stable currency, reflecting the economy on the island. Coins are minted in values of 1, 2, 5, 10, 20, and 50 cents and banknotes printed in denominations of CY£1, CY£5, CY£10 and CY£20. Sums in cents are normally written CY£0.50, etc.

It’s wise to obtain some local currency banknotes and coins before arriving in the country and to familiarise yourself with them. You should have some local currency in cash when you arrive, although you should avoid carrying a lot of cash. This will save you having to queue to change money on arrival at an airport (where exchange rates are usually poor).

Obtaining Cash

While cheques and credit cards are commonly accepted in major cities and tourist areas, in remote rural areas cash is the most common and sometimes the only form of payment acceptable.

Many foreigners living in Cyprus (particularly retirees) keep the bulk of their money in a foreign account (perhaps an offshore bank) and draw on it with a cash card locally using an automatic teller machine (ATM).

Banks in the main towns and the capital, Nicosia, have foreign exchange departments where you can buy and sell foreign currencies, cash travellers’ cheques, and obtain a cash advance on credit and charge cards. This is an ideal solution for holidaymakers and holiday-homeowners, although homeowners will still need a local bank account to pay their bills.

When using a credit or debit card, there’s usually a daily limit and a withdrawal charge, and you need a personal identification number (PIN). Some credit card companies don’t offer the best exchange rate on withdrawals. Most banks charge around 2 per cent commission with a minimum charge of CY£2.50, so it’s expensive to change small amounts.

There are also private bureaux de change in Cyprus, with longer business hours than banks, particularly at weekends. Most offer competitive exchange rates and low or no commission (but always check). They’re easier to deal with than banks, and if you’re changing a lot of money you can also usually negotiate a better exchange rate. However, the best exchange rates may still be found at a bank, even taking into consideration commission charges. Never use unofficial moneychangers, who are likely to short change you.

The official exchange rates for most European and major international currencies are listed in banks and daily newspapers. Always shop around for the best exchange rate and the lowest commission.

There isn’t a lot of difference in the cost of buying Cypriot currency using cash, travellers’ cheques or a credit or debit card. However, many people carry only cash when visiting Cyprus, which is asking for trouble, particularly if you have no way of obtaining more cash locally, e.g. with a credit card or travellers’ cheques. One thing to bear in mind when travelling anywhere is not to rely on only one source of funds.

Travellers’ Cheques

If you’re visiting Cyprus, it’s safer to carry travellers’ cheques than cash, although these are becoming less common and aren’t as easy to redeem as in some other countries, e.g. the US. For example, they aren’t usually accepted by businesses, except some hotels, restaurants and shops, all of which usually offer a poor exchange rate.

It’s best to buy travellers’ cheques in pounds sterling for Cyprus. You can buy them from any Cypriot bank, usually for a service charge of 1 per cent. In Cyprus, Thomas Cook travellers’ cheques can be cashed commission-free at any branch of the Bank of Cyprus. Banks usually offer a better exchange rate for travellers’ cheques than for banknotes.

Always keep a separate record of cheque numbers and note where and when they were cashed. American Express provides a free, three-hour replacement service for lost or stolen travellers’ cheques at all their offices worldwide, provided that you know the serial numbers of the lost cheques. Without the serial numbers, replacement can take three days or longer. Most companies provide toll-free numbers for reporting lost or stolen travellers’ cheques in Cyprus.

Article by www.justlanded.com. Click to read more articles about Cyprus and many other destinations.