If you’re planning a trip to the Kingdom or just curious about how global oil money actually moves, there’s one word you need to know: Riyal.
Basically, the name of Saudi Arabia's currency is the Saudi Riyal. You’ll see it written as SAR on currency exchange boards or SR on price tags in a Riyadh mall. It’s one of the most stable currencies in the world, but the story of how it got there is honestly pretty wild. It involves everything from old Spanish silver coins to "pilgrim receipts" that acted like secret paper money.
People often assume every Middle Eastern country uses the same "dinar" or "dirham." They don’t. Saudi Arabia has stuck by the Riyal for nearly a century, and it’s become the backbone of their massive economic shift.
What is the Saudi Riyal?
The Saudi Riyal ($SAR$) is the official legal tender of the Kingdom of Saudi Arabia. One riyal is broken down into 100 halalas.
You probably won’t see many 1-halala coins rolling around—they’re tiny and mostly symbolic now—but the 25 and 50 halala coins are still common for small changes. If you’re at a grocery store, you might even get a 1 or 2 riyal coin. Yes, they have those too.
Most of the "heavy lifting" is done by the banknotes. The Saudi Central Bank (formerly known as SAMA or the Saudi Arabian Monetary Authority) prints these in denominations of 5, 10, 50, 100, and the big 500 riyal note.
The 500 riyal note is the one you really want in your wallet. It usually features King Abdulaziz Al Saud, the founder of the modern Kingdom. It’s a blue, high-tech piece of paper that feels like quality because, well, it represents a lot of value.
Why the Riyal Never Really Changes Value
If you look at a chart of the Saudi Riyal against the US Dollar from ten years ago and compare it to today, January 16, 2026, you’ll notice something weird. The line is almost perfectly flat.
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That’s because the Saudi Riyal has been pegged to the US Dollar since 1986.
The exchange rate is fixed at $1 USD = 3.75 SAR$.
It doesn't matter if the stock market crashes or oil prices jump; the central bank works behind the scenes to keep that number exactly where it is. Why? Because Saudi Arabia sells its oil in dollars. Keeping the currency tied to the dollar makes trade predictable and keeps the local economy from swinging wildly every time the price of a barrel of Brent crude moves.
Some analysts in late 2025 speculated about "de-pegging" to join a BRICS-style basket of currencies, but honestly, the 3.75 rate is so deeply baked into the Saudi budget that a change anytime soon is unlikely.
A Quick Trip Through Currency History
Before the modern riyal, things were a mess. People used whatever silver or gold coins they could find.
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Back in the early 1900s, the most popular "money" was actually the Maria Theresa Thaler, an Austrian silver coin. Locals called it the "French Riyal" even though it wasn't French. It was just a big, heavy silver coin everyone trusted.
When King Abdulaziz started unifying the country in the 1920s, he knew he needed a real national currency. He started with the Hejaz Riyal and eventually moved to the Saudi Riyal we know today.
The Weird Case of Pilgrim Receipts
Here’s a fun fact most people forget: Saudi Arabia didn’t have official paper banknotes until the 1950s.
Before that, they used "Pilgrim Receipts." Millions of people would come for Hajj, and carrying heavy silver coins was a nightmare for them. The government issued paper receipts that said, "We owe you this much silver."
People liked the paper so much they just started using it as money. Eventually, the government realized paper was the future, and the first official banknotes were born in 1961.
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How to Tell if Your Riyals are Real
Since the riyal is so stable, it’s a target for counterfeiters, though the Saudi Central Bank has made the new "Sixth Issue" notes almost impossible to fake.
If you’re holding a 100 or 500 riyal note, try these tricks:
- Feel the texture: The writing and the royal portraits are "embossed." This means they feel rough or raised when you run your fingernail over them.
- Check the 3D strip: On the 500 note, there’s a metallic strip that changes shape and color when you tilt it. It’s not just a shiny sticker; it’s woven into the paper.
- The Watermark: Hold it up to the light. You should see a clear portrait of the King and the denomination number. If it looks blurry or like it was printed on the surface, it’s a fake.
- Look for the 2030 Logo: Newer notes often feature a tiny, transparent window with the "Saudi Vision 2030" logo.
Handling Money in Saudi Arabia Today
Kinda surprisingly, Saudi Arabia has gone almost entirely cashless over the last few years.
You can pay for a 2-riyal water bottle at a gas station in the middle of the desert using Apple Pay or a Mada card (the local payment network). Most locals don't even carry wallets anymore—just their phones.
However, if you're heading to older souks (markets) or taking a local taxi in smaller cities, cash is still king.
What to do next
If you're heading to Saudi soon, don't worry about "timing the market" for a better exchange rate. Since it's pegged, the rate today will be the same rate next month.
- Check your bank's international fees. While the 3.75 rate is fixed, your bank might charge a 3% "foreign transaction fee."
- Download the STC Pay or Urpay app. These are local digital wallets that make life much easier if you're staying for more than a few days.
- Keep a few 10 and 50 riyal notes. They are perfect for tipping or small purchases where "the machine is broken."
The Saudi Riyal isn't just a piece of paper; it's a symbol of how the country transformed from a desert kingdom using silver coins to a global financial powerhouse.