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The official currency in Vietnam is Dong. The Dong is non-convertible and at the time of writing trades at approximately 16,000 to USD1. The U S dollar, preferably crisp clean bills, is widely accepted among major shops and restaurants. Travelers checks can be cashed at authorized foreign exchange outlets and banks and require presentation of passport . There is normally a 2 to 5 percent transaction fee for cashing Travelers checks. Visa and Master card are becoming more accepted in many of the bigger hotels and restaurants, especially in the larger cities.
Make sure that the Vietnamese notes you receive are not torn, this because many shops and restaurants will not accept them. Also try not to change too much money at one time, as you will end up with a large wad of notes. The largest denomination is currently 500,000 dong (approx. U S$ 33). The government introduced new 500,000; 50,000, 20,000 and newly arrived, a 10,000 note made from plastic (like Australian dollars), rather than the regular paper notes. Becareful, the 20,000 notes look slightly different from the 500,000 one but the value is a big gap.
In 2004 Vietnam introduced coins for smaller transactions. These are in the form of 200; 1,000 and 5,000 Dong. Other paper denominations include 2,000; 5,000; 10,000 and 20,000. Most are clearly identifiable by color.
When you agreeing prices with Taxi drivers or shops, try to agree the price in the currency you intend to pay with (Dong or U S Dollars) to save arguments later about the exchange rate you were expecting.  While most will use a rate of 16,000VND to the dollar, some do try to argue differently.  Always double check the conversion rate you have been offerred.

Also with such high denominations of note, be careful of common scams run by street sellers where you are short changed by a factor of ten (eg as part of your change, you may receive five 200 dong notes as "10,000 VND!)
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