Costs for goods and services are slightly cheaper than those of Western Europe, mostly because Croatia is not on the euro. Zagreb and the coastal areas are substantially more expensive than areas inland such as Slavonia. Groceries can be expensive at shops on the islands, so if you've rented an apartment for a week or more, consider buying some staples at one of the hypermarkets in a bigger city.
U.S. banks seldom have Croatian currency on hand, and it may take as long as a week to order. If you're planning to exchange funds before leaving home, don't wait till the last minute.
ATMs and Banks
Your own bank will probably charge a fee for using ATMs abroad; the foreign bank you use may also charge a fee. Nevertheless, you'll usually get a better rate of exchange at an ATM than you will at a currency-exchange office or even when changing money in a bank. And extracting funds as you need them is a safer option than carrying around a large amount of cash.
ATMs are found throughout Croatia, islands included. PINs with more than four digits are not recognized at ATMs in many countries. If yours has five or more, try to change it before you leave.
It's a good idea to inform your credit-card company before you travel, especially if you're going abroad and don't travel internationally very often. Otherwise, the credit-card company might put a hold on your card owing to unusual activity—not a good thing halfway through your trip. Record all your credit-card numbers—as well as the phone numbers to call if your cards are lost or stolen—in a safe place, so you're prepared should something go wrong. Both MasterCard and Visa have general numbers you can call (collect if you're abroad) if your card is lost, but you're better off calling the number of your issuing bank, because MasterCard and Visa usually just transfer you to your bank; your bank's number is usually printed on your card.
If you plan to use your credit card for cash advances, you'll need to apply for a PIN at least two weeks before your trip. Although it's usually cheaper (and safer) to use a credit card abroad for large purchases (so you can cancel payments or be reimbursed if there's a problem), note that some credit-card companies and the banks that issue them add substantial percentages to all foreign transactions, whether they're in a foreign currency or not. Check on these fees before leaving home, so there won't be any surprises when you get the bill.
Before you charge something, ask the merchant whether he or she plans to do a dynamic currency conversion (DCC). In such a transaction the credit-card processor (shop, restaurant, or hotel, not Visa or MasterCard) converts the currency and charges you in dollars. In most cases you'll pay the merchant a 3% fee for this service in addition to any credit-card company and issuing-bank foreign-transaction surcharges.
Dynamic currency conversion programs are becoming increasingly widespread. Merchants who participate in them are supposed to ask whether you want to be charged in dollars or the local currency, but they don't always do so. And even if they do offer you a choice, they may well avoid mentioning the additional surcharges. The good news is that you do have a choice. And if this practice really gets your goat, you can avoid it entirely thanks to American Express; with its cards, DCC simply isn't an option.
Major credit cards are accepted in most hotels, shops, and restaurants, but make sure to have some cash on you for smaller groceries, toilet stops if you're traveling, and ice cream breaks. Some private accommodations will accept credit cards, although cash payments will likely get you a little discount.
Currency and Exchange
The Croatian currency is called the kuna (Kn), which is made up of 100 lipa. The kuna is not yet fully convertible, so you cannot expect to readily buy the currency outside of Croatia or exchange it once outside the country.
Most hotels in Croatia are also priced in euros and some will accept euros as payment.
For the most favorable rates, change money through banks. Although ATM transaction fees may be higher abroad than at home, ATM rates are excellent because they are based on wholesale rates offered only by major banks. You won't do as well at exchange booths in airports or rail and bus stations, in hotels, in restaurants, or in stores.
Even if a currency-exchange booth has a sign promising no commission, rest assured that there's some kind of huge, hidden fee. (Oh … that's right. The sign didn't say no fee.). And as for rates, you're almost always better off getting foreign currency at an ATM or exchanging money at a bank.