Bermudian Dollar (BMD): What It Is, How It Works, History

What Is the Bermudian Dollar (BMD)?

BMD is the currency abbreviation or currency symbol for the Bermudian dollar, the official currency of the island of Bermuda. Like the U.S. dollar, the Bermudian dollar is made up of 100 cents, and it's often presented with the dollar sign as BD$. It's present that way to allow the BMD to be distinguished from other currencies denominated in dollars, such as the U.S. dollar (USD).

The BMD is pegged to the U.S. dollar at a rate of 1:1.

Understanding the Bermudian Dollar

The BMD was first introduced in 1970. The preceding currency, the Bermudian pound, was equivalent the United Kingdom's pound sterling and similarly divided at the time into shillings and pence. The transition allowed Bermuda to decimalize its currency and reorient its economy towards the larger economy of the United States.

When the BMD was introduced, the exchange rate was fixed at a rate of 2.40 BD$ to one pound sterling. The new currency circulated alongside British currency until 1972, when the BMD was officially pegged at parity with the USD.

Because the BMD is fixed to the USD, U.S. dollars can be used throughout the island of Bermuda. Other foreign currencies such as the British pound, euro, and Canadian dollars are generally not accepted for payment on the island. The U.S. dollar is the only accepted foreign currency in Bermuda, and approximately three-quarters of all Bermuda's imports, tourists, and commerce originate from America.

Special Considerations

If you visit the island and need to withdraw cash from an ATM, you will receive your funds in Bermudian dollars. This is important to be aware of because as a local-only currency, the Bermudian dollar is not exchangeable or cashable by the banks of foreign countries. So if you don’t exchange any BMD back to the currency of your national residence before you depart the island, any BMD currency you bring home with you is only useful as a souvenir, at least until you return to Bermuda.

Bermuda dollar notes are available in denominations of $2, $5, $10, $20, $50, and $100. Coins are available in increments of 1, 5, 10, 25, and 50 cents, as well as a $1 coin, which replaced Bermuda’s $1 dollar note.

Early History of Money in Bermuda

Bermuda’s first formal minted currency was introduced in approximately 1615. These coins, which preceded the advent of paper currency in the country, depicted images of the wild boar that were prevalent on the island. The coins soon came to be called “hog” or “hogge money.”

Sometime later, Bermuda adopted the Spanish dollar as its national currency, which was later replaced by the pound sterling in 1842. The pound sterling remained Bermuda’s legal tender for the next 130 years until 1972, when the island nation formally pegged the BMD to the USD.

Correction–Jan. 16, 2022: A previous version of this article mistakenly stated that Bermuda was independent. In fact, it is a British Overseas Territory.