The Traveling Taylors

On our first trip to the UAE, we were fascinated by the UAE Dirham (AED) – its unique coins, banknotes, and strong link to the US dollar. If you’re preparing for your journey, here’s a handy guide to help you understand the dirham and make the most of your money in the Emirates.

What Is the UAE Dirham?

• Currency name & code: Known locally as the dirham (د.إ), abbreviated AED or Dhs; subdivided into 100 fils.
• Introduced in 1973, replacing the Qatar/Dubai riyal and Bahraini dinar across the emirates.

Coins & Banknotes in Circulation

• Coins in use: Common denominations are 25 fils, 50 fils, and 1 dirham; smaller 1, 5, and 10 fils coins exist but are rarely used.
• Banknotes: Issued in 5, 10, 20, 50, 100, 200, 500, and 1,000 dirhams. Recent polymer notes include the 50 dirham note (2021), 200 dirham note (2022), and 500 dirham note (2023).

Pegged to the US Dollar

• Fixed exchange rate since 1997: 1 USD ≈ 3.6725 AED (or ≈ 0.272 USD per AED).
• This peg ensures currency stability, which supports trade, tourism, and budgeting for travelers.

Why the Peg Matters

• Predictable rates: Avoids wild currency shifts—great for visitors planning expenses.
• Economic strength: Benefits from UAE’s diverse economy and oil-backed reserves.
• Traveler convenience: Exchange rates remain consistent across banks, airports, and exchangers.

Converting Dirhams Abroad

• As of June 11, 2025: 1 AED ≈ 0.27229 USD, or 1 USD ≈ 3.6726 AED.
• Rates may slightly vary with providers like Western Union or Revolut.
• Tip: Use local ATMs in the UAE for the best exchange rates—avoid airport kiosks.

Traveler Tips

• Use exact coins for small purchases—prices are often rounded to nearest 25 fils due to limited use of smaller denominations.
• Keep newer polymer notes like the shiny 50 AED as souvenirs—they’re eye-catching!
• Avoid confusion: Some foreign coins (e.g., Philippine peso) are similar in size to a 1 AED coin—watch out in vending machines.

Final Thoughts on the Dirham

The UAE Dirham stands out for its stability, history, and smart design. With its steady USD peg and clear denominations, managing your travel budget in the UAE is refreshingly simple. Grab a mix of coin and note denominations, swap currency via ATMs or banks, and enjoy a hassle-free financial start to your UAE adventure.