Source: https://rivet.global/blog/kuwait-smes-dinar-basket-paying-in-usd-eur
Published: 2026-10-10 · Updated: 2026-10-10 · By Rashidatou K.

# Kuwaiti SMEs paying suppliers in dollars and euros: the dinar basket and conversion costs

The Kuwaiti dinar is pegged to an undisclosed currency basket, not the dollar alone. What that means for paying suppliers abroad, and how to reduce conversion costs.

## Key takeaways

- The Kuwaiti dinar is pegged to a basket of currencies of Kuwait's main trade and financial partners, with weights not disclosed.
- The dinar moves slightly against the dollar and more against the euro.
- Importers pay suppliers mostly in dollars and euros.
- Buying currency in planned amounts, rather than at each invoice, reduces conversion costs.

A Kuwait City furniture retailer imports from Italy, the US and China. It converts dinars to euros and dollars at its bank each time an invoice falls due. Over a year, the conversion spreads on its supplier payments equal a month of rent, and the euro's rise against the dinar added a few percent to its Italian costs.

## The basket peg

Kuwait's central bank pegs the dinar to a basket of currencies of its main trade and financial partners. The weights are not published, though the dollar is generally understood to dominate. Kuwait moved back to the basket in 2007 after a period pegged to the dollar alone.

In practice the dinar moves a little against the dollar and more against the euro and others.

## Supplier currencies

- US and many Asian suppliers: dollars.
- European suppliers: euros.
- Chinese suppliers: dollars, sometimes yuan.

## Reduce the conversion cost

1. Buy in planned amounts. Converting once a month for known payments costs less than converting at each invoice.
2. Hold dollars and euros for recurring suppliers.
3. Compare rates. Retail bank rates for small companies can be wide.
4. Agree charges. Settle who pays transfer fees in each supplier contract.

## Controls

Supplier payment fraud often starts with an email announcing new bank details. Confirm changes by phone with a known contact, and require two approvers for the first payment to new details.

## Where Rivet fits

A Rivet business account accepts registered companies after verification, including Kuwaiti companies, subject to local rules. Approved companies get US account details on every plan and euro and sterling details from the Growth plan, and pay suppliers in 120+ countries at a rate shown before confirming. From Growth, payouts can require a second approver. Rivet is not a bank; regulated partner institutions hold the funds.

## Questions

### Is the Kuwaiti dinar pegged to the dollar?

Not solely. Since 2007 it has been pegged to an undisclosed weighted basket of currencies, generally understood to be dominated by the dollar.

### Does the dinar move against the dollar?

Slightly, because of the basket. It moves more against the euro and other currencies.

### How can Kuwaiti SMEs reduce supplier payment costs?

Compare conversion rates, buy currency in planned amounts, hold dollars and euros for recurring suppliers, and agree who pays transfer fees.

### How do I avoid supplier fraud?

Confirm any change of bank details by phone with a known contact and require two approvers for payments to new details.