How do you pay in Colombia, and how do you open an account?

There are three ways to pay in Colombia, and each has its own rules, its own fees and its own places where it does not work.

Cash is taken by everybody. Cards only in some places. And then there is a third way with no European equivalent, which over the past year has taken over small payments: instant transfers by key or QR code. Arrive with only a card and your first week will feel like another century; then you realise it is the other way round.

Cash still leads, but not where you would expect

Cards work in large supermarkets, shopping centres and at most petrol stations. In a small shop, a local restaurant, at the market, in a tuk tuk or with a tradesman, assume the card will not work.

A few practical things about Colombian cash:

• Notes are 2, 5, 10, 20, 50 and 100 thousand pesos; coins 50, 100, 200, 500 and 1,000.
• The hundred thousand note is a problem. You cannot pay with it in a bakery and nobody will change it for you. The word you need is sencillo, small change, and locals hunt for it too.
• Break notes in big shops with a proper till, and save the small stuff for markets and transport.
• Counterfeits exist, mostly fifties and hundreds. Cashiers hold them up to the light as a matter of routine; it is not distrust of you.
• Do not count money in the street. Pulling out a wad on the pavement is exactly what nobody does in Medellín.

How much to carry

Two wallets. One holds what you will spend today, fifty to a hundred thousand pesos in small notes, and that is the one you take out. The other holds the card and the reserve and stays where it is.

Carrying everything in one and pulling that one out at a stall is precisely what is called giving papaya here.

Cards: where they work and how not to lose on them

Your European card works in Colombia, but the outcome rests on three things, two of which you control.

Always pay in pesos. When the terminal or the cash machine asks whether you want to pay in euros or your home currency, say no. That conversion is known as DCC and the rate is set at that moment by the party asking. The gap is commonly three to seven per cent and all of it against you.

Your own bank's fees. Your bank charges for payments and for withdrawals, and on ordinary European cards that is not negligible. A card with no foreign currency fee is worth arranging before you fly.

Tell your bank you are travelling. Plenty of banks block South American transactions as suspicious. Either notify them in advance or expect a phone call in the middle of your shopping.

Cash machines: where to withdraw and what it costs

Withdraw inside a bank or in a shopping centre, not from a machine on the street. It is not only about money: a pavement ATM is a classic place for foreigners to get robbed.

• The machine's fee appears on screen before you confirm. If you do not like it, cancel and try another bank; the differences between networks are noticeable.
• Withdraw larger amounts at once. The fee is fixed, so five small withdrawals cost five times what one large one does.
• The per withdrawal limit tends to sit between a few hundred thousand and two million pesos depending on the bank and your card.
• And mind the same question as at the till: "in your own currency?" means a worse rate. Always pesos.

The question nobody from Europe expects

When you pay by card in a Colombian shop, the assistant asks: "¿cuántas cuotas?", how many instalments.

Colombians routinely pay by credit card over three, six or twelve months, with the bank adding interest. On a debit card the question makes no sense, and on a foreign card it makes none either.

The answer is "una", one instalment. Say a higher number and you land in a repayment scheme you did not want; on a foreign card it usually just ends in a declined transaction.

Rent, bills and PSE

Bills for electricity, water, gas and internet arrive monthly as a recibo, a payment slip with a barcode. There are three ways to pay it:

• at a bank branch or in a shop (Éxito, chemists, small offices such as Efecty), handing over the slip and paying cash,
• from your account through PSE, the Colombian standard for paying online from a bank account: pick your bank, log in, confirm,
• by direct debit, arranged with the provider and by far the easiest once you are staying.

Rent in Colombia is normally paid by transfer or through Bre-B, not in cash. Ask for a receipt for every payment; paper proving you paid matters more here than a European expects.

The receipt not to throw away

Colombia runs electronic invoicing and businesses commonly issue a factura electrónica. Anyone dealing with taxes, expenses or VAT refunds here needs it in their own name and with an identification number, not just a till receipt.

A tourist may be able to reclaim VAT on certain goods when leaving, but only for selected categories and with documents in their name. Worth trying on larger purchases, not on coffee.

Bre-B: the thing Europe does not have

This is the biggest change of recent years and it needs explaining, because almost all small commerce now leans on it.

Bre-B is the unified instant payment system run by Colombia's central bank, interoperable across banks and wallets since 2025. More than thirty institutions take part, among them Bancolombia, Davivienda, Nequi and Daviplata.

It works on keys (llaves). A key is whatever the system finds you by: a phone number, an ID document, an email address or a generated code. One person can hold up to four keys and registration is free.

In practice:

• You do not pay to an account number, you pay to a key or by scanning a QR code.
• The money arrives instantly, across different banks, weekends included.
• No card terminal is needed. Which is why a fruit stall takes it.

For a foreigner that yields one thing, and it matters: without a Colombian account or wallet you cannot enter this world at all. Two weeks here and cash plus a card is fine. Months here and you want an account or a wallet, because otherwise you are paying in cash for things locals settle on a phone in three seconds.

Nequi and Daviplata: the wallets everybody has

Nequi belongs to Bancolombia, Daviplata to Davivienda, and both are apps tied to a phone number. They open in minutes, carry lower limits and do exactly what a European uses cash for: splitting a bill, sending a few thousand, paying for lunch, topping up credit.

Worth knowing:

• The basic tier has low caps on balance and monthly turnover. More than that requires full identity verification.
• A foreigner usually opens one with a cédula de extranjería. With a passport it is sometimes possible, at a branch rather than in the app.
• They are connected to Bre-B, so from a wallet you can pay somebody at any other bank.

A bank account: what will be asked of you

An account at a major bank (Bancolombia, Davivienda, Banco de Bogotá) is a different league from a wallet: rent can be paid from it, income arrives into it, and it shows up in a visa application.

What you generally need:

• a cédula de extranjería, the residence document, not just a passport,
• proof of income or of the source of funds,
• proof of address (a utility bill, a lease),
• patience: opening happens at a branch, on paper, over two visits.

There are digital banks where it is quicker and easier, but with them you may find that some companies cannot send you money or set up a direct debit. For the first year it is reasonable to have both: a big bank for contracts and a wallet for ordinary life.

The four per thousand nobody mentions

Colombia has a financial transactions tax known as the 4x1000. Every withdrawal, outgoing transfer or payment from an account is charged four per thousand of the amount. On a million pesos that is four thousand, which looks like nothing until it adds up over a year.

The exemption is the important part:

• Every individual has 350 UVT exempt per month. The UVT is a tax unit, set at 52,374 pesos for 2026, so the exempt ceiling works out at roughly 18.3 million pesos a month.
• But the account has to be flagged as exempt. It is not automatic, you request it at the bank, and it is one of the first things to do after opening.
• From 2026 the exemption is counted per person rather than per account, so movements across banks are added together.

For an ordinary person this means the tax practically never applies. For somebody moving larger sums it means doing the arithmetic.

Money in and out of Europe

A transfer through a service like Wise almost always beats a SWIFT bank transfer, and beats withdrawing cash in small amounts by a mile. You send euros, it arrives in pesos in a Colombian account, and you see the rate up front.

Things to watch:

• Currency risk. The peso moves by several per cent in a week. If your income is in euros and your spending in pesos, do not hold a large balance in one currency purely out of inertia.
• Invoicing clients. Working for European clients from Colombia is ordinary, but tax residence changes after 183 days of presence, and from that point it is a different exercise. I write about it in the visa guide; here I will only say that it cannot be solved by not thinking about it.
• Cash across the border. Declarable from ten thousand dollars or the equivalent. It is not a ban, it is a form.

Exchange rates and where to change money

Change nothing at the airport beyond the fare for a taxi. The rate there is the worst you will meet in the country.

In the city you change money at casas de cambio in shopping centres, where rates are displayed and can be compared. Dollars get a better rate than most European currencies, which are exotic here and often refused.

In practice the simplest approach is: withdraw large amounts from a cash machine, pay by card where cards work, and change physical currency only as an exception.

The first forty eight hours

1. Withdraw only a little at the airport, a hundred or two hundred thousand pesos for transport and the first day. The rate and the fees there are the worst you will meet.
2. Withdraw a proper amount in the city, from a machine inside a bank or in a shopping centre.
3. Get small notes with your first purchase: buy something for twenty thousand with a large note in a supermarket, not in a bakery.
4. Turn on transaction alerts in your home banking app and check the card works before you need it.
5. Leave the wallet app and the bank account until you have a cédula. Cash and a card are enough until then.

Five mistakes that cost money

1. Paying or withdrawing in your own currency. Three to seven per cent gone, every time.
2. Small withdrawals. A fixed fee paid five times instead of once.
3. Not asking for the 4x1000 exemption. Four per thousand of everything passing through the account, for nothing.
4. Carrying everything in cash. Not only because of theft: cash is genuinely less usable in Medellín than a key on a phone.
5. Relying on a card outside big shops. You end up with somebody else paying for your lunch and you sending it back through Nequi. Which is, incidentally, the exact moment you understand how payments work here.

How to read the numbers in this guide

The UVT and the exemption ceiling apply to 2026 and change every January. The Bre-B rules come from the central bank's documentation. Bank and ATM fees change constantly and depend on your card, so treat them as an order of magnitude, not a price list.

What is first hand is written as my own experience. Verify the rest before a larger transaction.