Last updated on May 8th, 2023 at 05:04 pm
SGD currency (or the Singapore dollar) isn’t just one of the most frequently traded currencies in the world, it’s also one of the most stable.
Although the Singapore dollar shares some similarities with the U.S. dollar and other dollar currencies, there are some unique features about SGD currency that distinguish it from other monetary systems.
Whether you need to send money to family and friends in Singapore, or you want to use Singapore dollars for business or travel, this guide is for you. Discover the history, denominations, and exchange rate of Singapore’s official currency.
SGD currency basics
The Singapore dollar uses the currency code SGD to distinguish it from other dollars, such as the U.S. dollar (USD), the Australian dollar (AUD), the New Zealand dollar (NZD), the Canadian dollar (CAD), and the Hong Kong dollar (HGD).
Just like these other dollars, the Singapore dollar is divided into 100 cents. They all use the same currency symbol, the dollar sign ($), although the symbol S$ can be used to identify SGD in cases when it isn’t already clear.
The Monetary Authority of Singapore (MAS) issues SGD coins and banknotes, broken down into the following denominations:
- Coins: 1, 5, 10, 20, and 50 cents as well as $1 and $5 coins
- Banknotes: $2, $5, $10, $20, $25, $50, $100, $1,000, and $10,000
Recently, Singapore has been discontinuing high-value banknotes (the $1,000 and $10,000 notes) to reduce the risk of money laundering.
They’ve also been replacing paper banknotes with polymer banknotes that have advanced security features.
History of the Singapore dollar
The Singapore dollar has been around since 1967, but the history of the country’s currency dates back even further than that. Singapore was an outpost of the British Empire for over a century — but it never adopted the Great British pound (GBP).
Traders had already brought the Spanish dollar to Southeast Asia, and the Straits Settlements used various forms of the dollar, as well as the Indian rupee, from 1845 to 1939. The U.K.-issued Straits dollar was the official currency in the Malay states, including Singapore, for several decades.
The Mayalan dollar replaced the Straits dollar in 1939, but not for long. The Japanese yen became the new local currency during the Japanese occupation of Singapore from 1942-1945. This “military yen” differed from the ordinary yen (JPY) and was known as “banana money” due to the banana plant printed on the $10 banknote.
Next came the Malaya and British Borneo dollar, which lasted from 1953 to 1967. For several years after Singapore declared its independence, it remained in the currency union with Malaysia and Brunei, before finally issuing its Singapore dollar.
SGD currency today
With such a complicated history, it may be surprising that the Singapore dollar currency became the economic powerhouse that it is today. There are several reasons for its rise to prominence, including the monetary policies of the central bank.
Because Singapore is an island country without many resources of its own to export, it has built its reputation as a transport hub and international financial sector.
Today, Singapore’s GDP is around $60,000 USD per capita, making it one of the world’s strongest market economies with strict penalties for corruption.
5 unique facts about SGD currency
Now that you know how the Singapore dollar came to be, what sets it apart from other currencies of the world?
Here are five facts about SGD currency that help to explain its role in international money transfers and foreign exchange markets.
1. It has one of the highest sovereign credit ratings in the world.
The Fitch Ratings system gives Singapore an AAA for long-term financial stability, the highest possible rating, shared with only 10 other countries. As its population gets older, Singapore may run into some fiscal issues, but it has substantial foreign reserves and “exceptionally strong external and fiscal balance sheets,” according to Fitch.
2. SGD currency is fully backed by assets like gold and silver.
Historically, currencies like the U.S. dollar and the Swiss franc (CHF) were backed by gold reserves to guarantee their stability. Now, that’s no longer the case, and many fiat currencies aren’t linked to physical reserves at all.
The Singapore dollar is notable for being fully backed by gold, silver, and other external assets, with a total of $60.282 million in circulation as of 2021.
3. The Singapore dollar was once pegged to the U.S. dollar.
Initially, the Singapore dollar was pegged to the pound sterling, which means that the value of the Singapore dollar stayed the same relative to the pound.
After the devaluation of the pound in 1967 — from $2.80 to $2.40 USD — Singapore pegged its currency to the U.S. dollar instead. For several years, $1 USD was equal to $3.06 SGD, until Singapore shifted its monetary policy once again.
4. Now, it’s pegged to a secret “basket of currencies.”
In the 1970s, Singapore pegged the dollar to a mix of currencies rather than any single one. This “basket of currencies” remains undisclosed but is linked to the countries that Singapore has major trading relationships with.
The Monetary Authority of Singapore also uses a “monitoring band” to keep tabs on the Singapore dollar exchange rate. It can float freely, but only within this limited bandwidth; otherwise the MAS will step in to regulate supply and demand.
5. The Singapore dollar is interchangeable with the Brunei dollar.
Although Singapore left the currency union it shared with Malaysia and Brunei, it didn’t entirely leave its neighbors behind.
For several years after Singapore’s independence, the Singapore dollar and Malaysian ringgit had an equivalent value.
Malaysia ended the agreement, but Singapore and Brunei never did, so the Singapore dollar is still legal tender in Brunei and vice versa.
Understanding the Singapore dollar exchange rate
Because the Singapore dollar can fluctuate in relation to other currencies, it’s important to check the exchange rate before making an international money transfer.
You can get a sense of the Singapore dollar’s value by looking up historical exchange rates or use an online currency converter to view real-time rates between two currency pairs.
For example, you can look up how much 1 SGD is worth in euros (EUR), Chinese yuan (CNY), Swedish krona (SEK), or Philippine pesos (PHP), just to name a few.
Although you can buy Singapore dollars freely around the world, if you’re traveling to Singapore, you’ll need to declare any amounts greater than $20,000.
Sending money around the world
Singapore is a major international business center and financial hub, attracting millions of workers from around the world who come to participate in Singapore’s economy. At the same time, many Singaporeans choose to live and work abroad and need to send money home to friends and family on birthdays or holidays.
Choosing the right money transfer app is key. When you send money with Remitly, you’ll get transparent rates on every transfer, and you can track its progress every step of the way.
Over 5 million customers trust us to send money safely and securely. Download the app today to get started!