United Arab Emirates Dirham (AED)

The United Arab Emirates dirham is the official currency in the United Arab Emirates and the currency in Dubai and Abu Dhabi. The currency was introduced in the country in 1973 when it replaced the Qatar and Dubai riyal at an exchange rate of 1 dirham for 1 riyal.

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The official Arabic name for the currency is درهم‎‎ which translates to the United Arab Emirates dirham however it’s usually just called the Emirati dirham. The official code for the currency is AED and that is the code used in forex trading and on other international markets. There are also other unofficial abbreviations of the currency including DH and Dhs.

Emirati dirham has its own Arabic sign: د.إ., similar to $ for the American dollar and € for the Euro.

One AED is divided into 100 fils, written like this: فلس in Arabic.

Dirham’s Denominations

The United Arab Emirates currency currently exists in 14 denominations, six coins and eight bills, stretching from 1 fils to 1,000 dirhams. Note that many of the circulating denominations are rarely used and you will only encounter a handful of the official coins and bills.

Currently, the following AED denominations are available:


  • 1 fils
  • 5 fils
  • 10 fils
  • 25 fils
  • 50 fils
  • 1 dirham


  • 5 dirham
  • 10 dirham
  • 20 dirham
  • 50 dirham
  • 100 dirham
  • 200 dirham
  • 500 dirham
  • 1,000 dirham


Out of these six different coins, only the 1 dirham coin and 50 fils are frequently used. The other four coins are still circulating but are rarely seen, and many shopkeepers and business don’t accept them anymore due to their small value. Instead, most prices are rounded up to the closest 50 or 25 fils.

All coins in the United Arab Emirates have their value written on them in Arabic numbers (similar to how we use them in the West) as well as in Arabic letters.

When the currency was first introduced only the 1, 5, 10, 50, and 100 bills were available. Since then bills have been added and removed at several different times. The 1,000 dirham bill was first released in 1976 but was removed again together with the 1 dirham bill in 1982, before getting reintroduced in the year 2000.

Out of all the above-mentioned bills, the 200 dirham bill is the most uncommon since it was only printed in one version back in 1989. Also, the 1,000 dirham is not used very often due to its relatively high value.

All the bills have their value printed on them in both Arabic and Western writing and they have designs with famous buildings, mosques, and skyscrapers from Abu Dhabi and Dubai. There are also pictures of animals that live in the United Arab Emirates depicted on all of the bills.

History of the United Arab Emirates Dirham

The word dirham derives from the Greek word drachma, meaning a “handful” and it has been used as the name for several currencies in the region. One of the original dirham currencies was the only currency to survive the Ottoman empire.

Before the new Emirati dirham was introduced in the 1970s, two different currencies were used in the country. Qatar and Dubai riyal was used across all emirates except for Abu Dhabi that instead used the Bahraini dinar. Before 1966, all the emirates were collectively using the Gulf rupee – a currency based on and pegged to the Indian rupee that was used in a currency union including all the Gulf states.

The Gulf rupee was terminated in order to help India’s own economy and since then most of the Gulf states, including the UAE, have surpassed India in terms of economic stability.

In 2006 the UAE government realized that the Philippine one peso, Pakistani 5 rupee, Omani 50 baisa, and the Moroccan 1 dirham coins were all the same size and weight as the one dirham coin. At the time, the Philippine peso was only worth 8 fils and this created opportunities for vending machine fraud. This issue has since been resolved.

The United Arab Emirates Dirham Today

Today, the Emirati dirham is printed and regulated by the UAE’s central bank – Central Bank of the UAE – with the main office located in Abu Dhabi. The currency’s exchange rate has been fixed since 1978. This means that the price of the AED is pegged to the IMF’s Special Drawing Rights (SDR) and that the price is controlled by the American dollar. The current pegged exchange rate is 1 USD = 3,6725 AED or 1 AED = 0.2722 USD.


It is fairly popular to trade the Emirati dirham on the global foreign exchange market and mostly as a currency pair with the USD. Since the AED is pegged to the USD, the exchange rate rarely creates big spreads, but there are still opportunities to make quick trades with AED/USD.

Local traders tend to prefer trading the AED with other Gulf state currencies such as the Omani rial and the Saudi riyal, but also with the Indian rupee.