The official currency of Chile is the Chilean peso (CLP). The CLP has been in circulation since 1975. One CLP is subdivided into 8 reales. Bank notes in Chile are in denominations of 500, 1,000, 2,000 5,000, 10,000 and 20,000 pesos.

When visiting Chile, you are best advised to carry lots of small bills as larger bills can be difficult to change in some areas. The best place to find favourable exchange rates is Santiago.

The Chilean peso has enjoyed a period of stability in recent years. The value of hard currencies tends to go down during tourism peak season and then go up during off-peak times. Some places accept foreign currencies, especially the dollar, but you have to be careful to check their exchange rates carefully.

There are exchange shops everywhere. In fact, in some cases, they are very close to each other and the margins between the buy and sell rates are very small. There are also places where you can pay in US dollars especially where the amount involved is large.

One Chilean peso is the equivalent of approximately 0.0012 British pounds and 0.0015 US dollars.

Almost all banking and financial activities are regulated in Chile. There is a law known as the Decree Law 600. The DL 600 regulates all foreign investments entering Chile. It also regulates legal entities and Chileans living abroad who want to remit funds to Chile. The minimum investment is set at $5,000,000 in currency and $2,500,000 for any other forms such as technology and tangible assets.

Using the DL 600 means effectively entering into a contract with the government. None of the parties to the contract can unilaterally amend the terms of the contract. However, investors are free to request some changes to the terms if they want to increase the amounts they are investing, surrender their rights or change the purpose of their investment.

There are also rules that govern foreign exchange transactions that are related to deposits, loans or investments coming from abroad, where the amount is more than $10,000. 

For expats, it can be extremely difficult to open a bank account in Chile. Most banks only accept expats who have had Chilean residency for two years. Even then, it is not always smooth sailing. This is the reason why many expats in the country opt for other alternatives instead of going through all the trouble.

  Expats are required to have a RUT (Rol Unico Tributario) number, which functions as their tax ID number while they are in Chile. The easiest way to obtain a RUT number is to have confirmed residency as well as a stable job.

However, bank transfers are still one of the most commonly used methods of transferring funds in Chile. Online banking has led to an increase in the number of people using this method although the frequency of transfers is still quite low.

For international transfers, Chile only accepts GBP, USD and EUR. That means that if you have another currency you may need to change it two times. Banks also charge to receive money from international accounts and the fees vary depending on the amounts.

The fee for sending money abroad is 2 per cent of the total amount or $50, whichever is higher. 

The other way to transfer funds in Chile is to use cash pickup agencies like Western Union and MoneyGram, Chile Express, Oanda or AFEX. Cash pickups will give you better rates for your money.

The cash pickups are found in multiple locations in the major towns in Chile, which means that receiving or transferring money is very easy.

The fact that banks charge so much money for international cash transfer makes cash pickups the best option. There are no account opening processes involved and the money reaches the recipients very quickly.

Different cash pickup agents charge different amounts, so it is prudent that you find the one with the most favourable rates. Also, remember to ensure that you provide the correct details when transferring money to avoid inconveniences to you or the recipient.