When I was in San Pedro de Atacama in Chile, I was chatting with a guy in my dorm room who was just in Argentina and lived there for about 4 months. I told him I was heading to Argentina as well and he gave me this very useful information on how to get a much better exchange rate for US dollars, better than the official rate.

Yes, you heard that right, better than the official rate. Way better. He told me that he met an American there and recommended using Xoom.com to send money to Argentina as you could get a much better rate. I just tried it a few days ago and it worked! I got about 30% more money than I would have if I used the ATM.

Why is this the case? Well, the Argentine government seems to have put currency controls in place. This resulted in “black markets” where the US dollar is traded at a much higher rate than the official one. Inflation is also a problem in Argentina, so having money in a different currency is one way to protect yourself from inflation, making the dollar even more valuable.

At the time of this writing, the official rate is 1 USD = 4.64 ARS. The Xoom.com rate is 1 USD = 6.05 ARS. You get over 30% more money using Xoom. The black market rate then has to be even higher than that for Xoom to make money. Argentina is actually cheaper for me now than Chile thanks to this.

Even without Xoom.com, if you have dollars in cash, money changers will still give you a much higher rate than the official one. For example, when I arrived in Argentina through Mendoza, I had to change some of my Chilean Pesos at the bus terminal. Before I left the guy asked me if I have dollars as he could give me 5.5 ARS for each USD. I’m sure other money changers can get you an even better rate.

As far as I know, you can only use Xoom.com with US bank accounts so if you don’t have one you might want to bring some dollars with you to Argentina to take advantage of the higher unofficial exchange rate.

Getting started is very simple, here’s what I did:

1. Check here to see if there’s a pickup location near you.

2. Sign up to Xoom.com. This link is my referral link. It will get both you and me a $25 Amazon gift card.

3. Select Cash Pickup.

4. Select the country you would like to send money to and it will show you the exchange rate.

5. Enter the recipient’s information (in this case, probably yourself). It will require an Argentinian address so just enter your hotel/hostel’s address.

6. Choose how you want to pay: either from your US bank account or by debit/credit card. Enter the necessary information. Use coupon code “cruz” to waive the fee for your first money transfer.

7. Review and authorize payment. You will get a confirmation email with a link for checking the progress of the transaction. Once the transaction is complete you will get another email that your money is ready to be picked up. The time it takes for the processing to finish might vary, but last time I tried it took about 1 hour to transfer from my bank account.

8. Write down or remember the Xoom Transaction Number and bring it with you, together with your passport, to the pickup location to get your money.

9. Spend your money.