The dollar in Ecuador

Ecuador uses the American dollar as currency. The bills and coins are the same as in the US with the addition of a brass dollar coin which is used quite freely. It is basically a cash society though credit cards such as Discovery, Visa, MasterCard and American Express are used freely. Some retailers will charge more if you do not use cash. An IVA of 12% is added to the cost of most items. Recently because of the economic collapse and to try to keep cash in Ecuador and prevent it from leaving the country, the government has passed regulations adding a protective tariff to almost all imported goods. This has affected the price of everything from electronics to perfume. There is also a law that a retailer must give you a receipt for every sale. It is the government’s way of regulating taxation on retail sales. Often there is this painstaking writing out of a receipt for sales as small as a loaf of bread. Retailers also expect you to provide the small change part of a transaction. If the sale is $20.43, they will ask for the 0.43 from your small change. ATM machines are everywhere. What most expatriates do is use a debit card from an American bank at a bank ATM machine and pay their bills with cash. We use a Bank of America account in the US and take out a few hundred dollars at a time. The international handling charge for our bank is $5.00 for each transaction. Other banks charge more or less. There are many excellent Ecuadorian banks but they are usually very crowded at the tellers booths. We were fortunate enough to be introduced by a friend to the private banking department of our bank and deal with an officer of the bank for our transactions. Transfers of money or deposits of foreign checks take a minimum of 21 days to clear. It is probably a good idea to take out a checking account at a local bank so you will have checks to pay things like rent, electric and water bills. Alternatively, you can easily arrange for your local bank to pay these bills automatically each month. Be aware that if you bring substantial amounts of cash into Ecuador to make an investment, the government charges 2% to take that money out of Ecuador. There may be ways around this but it is something to be aware of.