Understanding how money works in Israel will save you time, confusion, and unnecessary fees during your trip. Israel has a modern, well-developed financial system, and managing your money there is straightforward once you know the basics.
Israeli Currency: The New Israeli Shekel
The official currency of Israel is the New Israeli Shekel (NIS), often abbreviated as ILS on exchange boards or marked with the symbol. One shekel is divided into 100 agorot.
Coins and Notes
Coins come in denominations of 10 agorot, 50 agorot, 1 shekel, 2 shekels, 5 shekels, and 10 shekels. Banknotes come in denominations of 20, 50, 100, and 200 shekels. The notes are color-coded and feature portraits of notable Israeli cultural figures, making them easy to distinguish.
Exchange Rates
Exchange rates fluctuate, so check current rates before your trip. As a rough reference point, the shekel has generally traded in a range that makes Israel comparable in cost to Western European countries. Tourist areas and airports tend to offer less favorable exchange rates, so plan your currency exchange strategically.
Exchanging Money
Best Places to Exchange
- ATMs: Using your debit card at Israeli ATMs is generally the most convenient and competitive way to get shekels. ATMs are widely available in cities, shopping centers, airports, and tourist areas. Look for bank ATMs (Bank Hapoalim, Bank Leumi, Mizrahi Tefahot) rather than independent exchange machines.
- Licensed exchange bureaus: Found in major cities and tourist areas, these often offer better rates than hotels or the airport. Compare rates at a few locations before exchanging.
- Airport exchange: Ben Gurion Airport has exchange counters, but rates are typically less favorable. Exchange only enough for immediate transportation needs at the airport.
- Hotels: Hotel exchange desks are convenient but usually offer the worst rates. Use them only as a last resort.
ATM Tips
- Notify your bank before traveling to Israel so your card is not blocked for suspicious activity
- Choose to be charged in shekels rather than dollars when the ATM offers a choice (this avoids unfavorable dynamic currency conversion fees)
- Withdraw larger amounts less frequently to minimize per-transaction fees
- Some US banks have partnerships with Israeli banks that reduce or eliminate ATM fees; check with your bank before departure
Credit and Debit Cards
Credit cards are widely accepted throughout Israel. Visa and Mastercard have the broadest acceptance, followed by American Express. You can use credit cards at restaurants, hotels, shops, gas stations, and most tourist attractions.
Where Cards Work Well
- Hotels and guesthouses
- Restaurants and cafes (including most casual eateries)
- Supermarkets and chain stores
- Tourist attractions and museums
- Gas stations
- Pharmacies and larger shops
Where You May Need Cash
- Small market stalls and street vendors (especially in the shuk/market)
- Some taxis (though many now accept cards)
- Small shops in the Old City of Jerusalem
- Some public restroom attendants
- Tipping situations
- Small local restaurants outside major cities
Contactless Payments
Contactless payment (tap to pay) is widely available in Israel. Apple Pay, Google Pay, and contactless credit cards work at most modern payment terminals. This is often the quickest payment method.
Avoiding Card Fees
- Use a credit card with no foreign transaction fees if possible (several US cards offer this)
- When paying by card, always choose to pay in shekels rather than dollars to avoid dynamic currency conversion markups
- Keep receipts for your records, especially for larger purchases that may qualify for a VAT refund
How Much to Budget
Israel is not an inexpensive destination. Prices for food, accommodation, and transportation are comparable to or higher than Western Europe. Here are rough daily budget ranges per person:
Budget Traveler
- Hostel accommodation, street food, public transportation
- Approximately 250-400 NIS per day (excluding accommodation)
Mid-Range Traveler
- Three-star hotel, restaurant meals, mix of public and private transportation
- Approximately 500-800 NIS per day (excluding accommodation)
Comfort Traveler
- Four-star hotel, dining at quality restaurants, private tours and taxis
- Approximately 800-1500+ NIS per day (excluding accommodation)
Tipping Guide
Tipping is customary in Israel and an important part of service workers’ income. Here is a guide to tipping in common situations:
Restaurants
- Table service: 10-15 percent of the bill is standard. Check whether a service charge has already been added. If a service charge appears on the bill, you may add a small additional amount for exceptional service, but it is not required.
- Cafes: Rounding up the bill or leaving 10 percent is appreciated.
- Fast food and counter service: Tipping is not expected.
Hotels
- Housekeeping: 20-30 NIS per day left in the room is a kind gesture.
- Bellhop/porter: 10-20 NIS per bag.
- Concierge: 20-50 NIS for helpful assistance with reservations or recommendations.
Transportation
- Taxi drivers: Rounding up the fare is common. For longer rides, adding 5-10 percent is generous but not required.
- Tour guides: 100-200 NIS per day for a private guide; 50-100 NIS per day per person for a group guide.
- Tour bus drivers: 50-100 NIS per day for the group.
Other Services
- Spa and beauty services: 10-15 percent is customary.
- Delivery drivers: 10-15 NIS for food delivery.
Bargaining and Negotiation
Bargaining is common and expected in outdoor markets (shuks), particularly in the Old City of Jerusalem, Jaffa, and Bedouin markets. It is generally not practiced in fixed-price shops, supermarkets, restaurants, or malls.
When bargaining in markets:
- Start by offering roughly 50-60 percent of the asking price
- Be friendly and maintain good humor throughout the negotiation
- Be willing to walk away if the price does not meet your expectations; the vendor may call you back with a better offer
- Do not bargain aggressively for items you do not intend to buy
Tax-Free Shopping
Tourists are entitled to a VAT refund on purchases above a certain threshold from shops displaying the tax-free or VAT refund sign. Keep your receipts and forms and process the refund at Ben Gurion Airport before departure. See our dedicated VAT refund guide for complete details.
Final Money Tips
- Carry a mix of payment methods: a primary credit card, a backup card from a different network, and some cash in shekels
- Keep small bills and coins handy for tips, small purchases, and public restrooms
- Avoid carrying large amounts of cash
- Use a money belt or secure wallet, especially in crowded markets
- Save your receipts for potential VAT refunds and expense tracking
With a little preparation, managing money in Israel is simple and straightforward, letting you focus on the experiences rather than the transactions.
