The local currency is Tanzanian Shilling (Tzs). Many hotels require payment in US$, in particular for accommodation, but also for food and drink and for tours. Taxis and car rentals are also paid in US$. You do need Tzs for petrol in case you hire a car, and if you go shopping in the villages (you get better prices when you pay in Tzs). Tzs come in notes of 10,000, 5,000, 2,000 and 1,000 shillings. Coins used here are 500, 200, 100 and 50 Shilling.
Best place and rates to exchange US$ to Tzs are the EXCHANGE BUREAUS in Stone Town. The local banks offer bad exchange rates, the rates at hotels are even worse. You can also exchange money at the airport at the arrivals hall though you get better rates at the exchange bureau on the parking lot. Currently the best exchange rate is Tzs 2360 per US$ or 2645 Tzs per Euro (mid February 2019). You get the best rates for $100 and $50 notes. You can exchange US$, Euro, GDP, ZAR and other currencies at the local exchange bureaus. NB: US$ notes printed before 2006 are not valid in Tanzania/Zanzibar!
The bigger hotels, restaurants and car rentals have credit card facilities. A surcharge of 5% is applicable. Be aware that at many places credit cards are not accepted.
ATMs: You can only draw Tzs against your credit card or a card with a Visa or Mastercard logo. An ATM is at the airport parking lot, there are a few other ATMs in Stone Town. Most ATMs have a maximum payout of Tzs 400,000 per withdrawal. You can use your credit card multiple times until your daily withdrawal limit on your credit card is reached. You might have to visit different ATMs though.
There are NO ATMs outside of Stone Town, with these 2 exceptions:
Paje: The Barclays ATM is at the petrol station close to the police checkpoint
Dunga: A NMB ATM is between Dunga and Koani (central Zanzibar)
Petrol costs Tzs 2129 per liter for Super (early March 2019) and is paid in Tzs. You can also pay in US$ but you’ll get a really bad exchange rate.
Simcard/internet: You can buy a simcard at the exchange bureau on the airport parking lot, a Zantel simcard loaded with 3GB costs US$ 20 (Zantel is the service provider with the most coverage on Zanzibar). The exchange bureau is open 24/7.
Wi-Fi hotspots in Stone Town are at the airport, ferry port, at Forodhani Gardens, Mercury’s Restaurant and La Taverna restaurant. Most hotels and restaurants offer free Wi-Fi for their guests.