What Is the Christmas Island Currency and How Does It Work?

Christmas Island, a small Australian territory in the Indian Ocean, does not have its own currency. It uses the Australian dollar (AUD) for all transactions, relying on Australia’s banking system and financial regulations.

Legal Tender Status

As an external Australian territory, Christmas Island follows the same legal framework for currency as the mainland. The Australian dollar is the only recognized legal tender, meaning businesses, government agencies, and financial institutions must accept it. This is governed by the Reserve Bank Act 1959 and the Currency Act 1965.

Since the island lacks a central bank or independent monetary policy, financial regulations, including anti-money laundering laws and consumer protections, fall under Australian jurisdiction. The Australian Prudential Regulation Authority (APRA) oversees banking operations, ensuring compliance with national standards.

Cash transactions are common, but electronic payments are also widely accepted. Businesses use the same banking infrastructure as mainland Australia, allowing for seamless transactions via EFTPOS terminals, credit cards, and online banking. National monetary policy changes, such as interest rate adjustments by the Reserve Bank of Australia, can indirectly affect the local economy.

Denominations in Use

Australian banknotes and coins circulate freely on Christmas Island in the same denominations as the mainland. Banknotes come in $5, $10, $20, $50, and $100, with distinct colors and security features like polymer composition, transparent windows, and raised printing. Coins range from 5 cents to $2, with $1 and $2 coins being the most commonly used.

Smaller denominations, like 5-cent and 10-cent coins, are generally used for minor purchases, though some businesses round totals to the nearest 5 cents due to the elimination of 1-cent and 2-cent coins in the early 1990s. The $50 note is frequently used for larger purchases, while the $100 note is less common in daily transactions as some retailers may be hesitant to accept it due to concerns over counterfeiting or lack of sufficient change.

ATMs dispense Australian banknotes, typically in $20 and $50 denominations. Businesses accept both cash and electronic payments, with EFTPOS terminals accommodating debit and credit cards. Due to the island’s remote location, occasional cash shortages can occur if supply shipments are delayed, so visitors are advised to carry sufficient cash, especially when traveling to isolated areas.

Exchange Methods

Currency exchange on Christmas Island is straightforward, as the Australian dollar is the standard form of money. Since the island lacks dedicated foreign exchange bureaus, visitors carrying foreign currency must rely on local bank branches or Australia Post outlets for exchange services, though options may be limited. Exchanging money before arrival is recommended.

For international payments, bank transfers are the most efficient option. Australian banks on the island facilitate inbound and outbound wire transfers, with fees and processing times varying by institution and country. Online money transfer services like Wise and PayPal offer alternatives with competitive exchange rates and lower fees.

Digital payment methods are increasingly common, with many businesses accepting mobile wallets like Apple Pay and Google Pay. These platforms allow visitors to make purchases without carrying large amounts of cash, reducing the risk of loss or theft. Since the island’s banking infrastructure is integrated with the mainland, transactions using Australian bank accounts or credit cards process without additional foreign transaction fees.