The Indonesian rupiah is one of those currencies that are continually in the spotlight. However, not necessarily for positive reasons. On the one hand, Indonesia is a popular budget-tourist destination, so a lot of people are interested in how Indonesian currency works. On the other, unfortunately, it constantly ranks as one of the weakest currencies in the world.
For reference, as of March 2023, one U.S. dollar goes for around 15,084 rupiahs. If you are planning a trip to Indonesia or are simply curious about the rupiah, in this article, we'll cover everything you should know about how to use the rupiah and some tips for exchanging it, and provide some interesting facts regarding it.
For centuries, the Netherlands Indies gulden was the currency used in Indonesia, until Japan invaded in 1942 and started issuing its version of the gulden. On October 3, 1946, the Indonesian nationalists, during their struggle for independence, started issuing the rupiah, which would evolve into the modern Indonesian currency.
However, the rupiah was not recognized internationally until 1950, and a lot of local variations of currencies were used, alongside the Netherlands Indies and Japanese gulden. The rupiah was finally recognized only when the Indonesian federal government gained full control of the country and initiated a series of currency reforms between 1950 and 1951.
In 1949, the rupiah exchange rate was set to 3.8 rupiahs to one U.S. dollar. Unfortunately, the rupiah has mostly been devalued since that time, with short periods of stability. Over the years, the rupiah's exchange rate was both floating and fixed until we get to today with one dollar being valued above 15 000 rupiahs.
In modern times, a redenomination of the rupiah has been considered since 2010, when the Bank Indonesia (the central bank of Indonesia) proposed the elimination of the final three zeros to ease transactions. Other proposals were also put forth since then, but, as of yet, none have been enacted.
The ISO currency code of the rupiah is IDR, and the currency symbol is Rp. The Indonesian currency derives its name from the Sanskrit rupyakam – meaning silver. One rupiah consists of 100 sen. However, sen coins and banknotes are obsolete due to having no value.
The IDR banknotes come in denominations of 1,000; 2,000; 5,000; 10,000; 20,000; 50,000; and 100,000 rupiahs. Each denomination features a unique design that reflects different aspects of Indonesian culture and history.
The front of the IDR banknotes typically features a portrait of a national hero from Indonesian history, such as Soekarno, the first president of Indonesia, or Hatta, the country's first vice president. The front of the notes also includes the denomination of the note, the bank logo, and other security features.
The back of the IDR banknotes features various images of Indonesia's natural beauty, such as the Komodo dragon, Balinese dancers, and rice paddies. The back of the notes also typically includes traditional Indonesian patterns and designs.
In addition to the banknotes, Bank Indonesia also issues coins in denominations of 50, 100, 200, 500, and 1,000 rupiah. The designs on the coins typically feature Indonesian flora and fauna, such as the national flower, the rafflesia, and the country's wildlife.
The exchange rate of IDR to USD and USD to IDR can vary based on macroeconomic factors, geopolitical events, and changes in monetary policy. The Indonesian government plays a vital role in the national economy, by promoting exports and managing foreign reserves Indonesia's economy can be affected by global economic conditions, such as financial crises and fluctuations in import and oil prices.
Unfortunately, the Indonesian rupiah does not have a history of strength. It is volatile and depends on foreign investors and government policies.
If you are going to a popular tourist destination or a larger city, you will have no issue exchanging USD (or any other major currency) for the rupiah. You can exchange your currency for the rupiah at banks or exchange offices throughout the cities, and most resorts include money exchange offices. However, there are two caveats.
If you are going to rural areas, it is advisable to buy the rupiah beforehand, as banks and exchanges may not be readily available. Consequently, if you wish to buy foreign currency with rupiah (for example, if you are leaving and have a lot of rupiahs left), you should order it a day in advance, as many banks don't have large amounts of foreign currency on hand.
First, you can expect everything in Indonesia regarding money to be less formal and strict than you're used to. Don't be surprised if you hear a different term used for the rupiah. Many locals call it perak, which in Indonesian means silver (much like rupiah derives from the Sanskrit word for silver).
Then, you shouldn't be shocked if you rarely get exact change when buying something. As the rupiah has such a low value and the denominations tend to be so big, many locals simply round up or down the change to the nearest hundred. Or, you might even get candies or other knick-knacks instead of small change.
Try not to have only 50 000 or 100 000 notes in your wallet, as these can be hard to split. However, avoid exchanging money at airport kiosks or hotel exchanges - if you can. They tend to mark up the exchange rates and may have hidden fees.
Additionally, if someone offers you a denomination below 100 rupiahs, be it a coin or banknote, you likely won't be able to use it anywhere. Once you get acquainted with the culture and the customs, you may even find that the liberal approach to currency rules in Indonesia is to your liking.
As Bali is a province in Indonesia, they use the same currency as in other parts of the country.
Note that since Bali is a popular tourist destination, many businesses, particularly those catering to foreign tourists, may also accept payment in other currencies, such as US dollars or euros. However, the exchange rate used in such transactions may not be favorable, and it is generally recommended to use the rupiah for transactions in Bali.
If you want to play it safe and not worry about exchanging money when you go to Indonesia or getting bad rates at airports or hotel exchanges, you can buy Indonesian rupiah online while in the US and hit the ground running as soon as you arrive at your destination.
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