PERU MONEY SECURITY

* Travelers' cheques

* Cash

* Credits cards & ATM machines

* Direct debit cards

* Banks

* Casas de Cambio
* Changing money on the street.

Travelers' cheques
For safety's sake the bulk of your money should be carried as travelers' cheques. By far the best and most easily changed are American Express, although Thomas Cook, Citibank, and Visa are usually fairly easy to change in the major cities. To make replacement quicker in case of theft, keep a record of cheque numbers and the original bill of sale in a safe place. Even with proper records, replacement may not always be as quick as the companies promise.

In Peru you will find that the exchange rate for travelers' cheques is 1.5% to 2% lower than for cash - In my opinion this is a small price to pay for the added security.

Cash
For smaller villages and towns, travelers' cheques may be hard to cash or the rate of exchange is ridiculously poor. For these places bring along cash US dollars. Make sure that the notes that you bring from home or accept are in excellent condition. Even the slightest rip will make exchange almost impossible. Try to get the new style dollars with watermarks and the metallic strip embedded in the note as you're less likely to end up with a counterfeit note.

Credits cards & ATM machines
Of the major credit cards such as Visa, MasterCard, American Express and Diner's Club, you'll find Visa the most widely accepted in Peru. All of the major cities have numerous ATMs (automatic teller machines or 'hole in the walls'), so withdrawing cash is easy. Remember that when withdrawing cash using a credit cards you'll start paying interest on the amount from the moment you make the transaction.
Credit cards can also be used to pay shop, hotel and restaurant bills  but users should note that they will be charged between 5% and 10% commission, so ask first.

Direct debit cards
By far the best way  to withdraw money from an ATM is by using a direct-debit card such as Visa. On withdrawal, the money is immediately deducted from your bank account and no interest is charged so long as you have sufficient funds back home. The exchange rate is excellent. You may find, however, that like credit cards you may be limited to the amount that you can withdraw each day and if you sit on your card and break it you may be in big trouble!

Editors note: I've been living in Peru for 3 years now and living off my direct-debit Visa card. It's convenient, safe and the exchange rate is better than travelers cheques. However make sure that you have a second card available in case you card is strangely swallowed by an ATM. For obvious reasons, if you're on a tight program, try not to use your card after the bank is closed on the day before you plan to travel. I've also noticed that many banks give you your cash first and then eject your bank card (opposite way around to most countries). When you finally receive your handful of money try not to forget your card in the machine!
For a traveler on say a budget of $3,000, I would recommend bringing $1,500 in American Express travelers' cheques, $500 in US dollars cash and bring along a direct debit card (Visa) and a credit card for emergencies.

Casas de Cambio
These 'exchange houses' can be found in just about any town or city on the tourist circuit. They're often open all day and late into the night, are rarely crowded and the exchange rate is nearly always better than the banks.

Street Changers
Changing money on the street is perfectly legal in Peru. Unlike other South American countries, Peru does not have a Black Market exchange rate. In fact the rate on the street differs very little from the Casas de Cambio. Unless you're really stuck for somewhere to change money I don't recommend them.