The official currency of Bhutan is Ngultrum. However, you can use Indian currency in Bhutan for the smaller transaction. The higher denomination notes of INR 500 or INR 2000 are not accepted. Therefore, it is advisable to exchange your currency before you start your Bhutan tour. Bhutan is a cash-based economy. Though you can use Credit Cards in luxury hotels or fine dining restaurants, the local shops do not accept cards. Therefore, it is advisable to take cash with you.