Managing and exchanging money in Mexico is an important consideration for your trip. You need to understand the currency used in Mexico (pesos), the best way to exchange currency, and any fees your credit and debit cards charge for international transactions and withdrawals.
This guide has been written by an expat who has been living in Mexico for over a year. And who is well versed in the stresses and dramas of trying to withdraw cash and pay for things overseas without incurring a ton of bank charges.
Money in Mexico
The Mexican peso (Mexican Nuevo peso in full) is the legal tender in Mexico. Pesos have been used since the 19th century – all the way back in 1863.
Cards and contactless payments are becoming more and more accepted in Mexico. This is particularly true in Mexico City and in tourist destinations like Cancun, Puerto Vallarta, and Los Cabos.
A lot of businesses in larger cities and resort areas will accept Google Pay and card payments made using the banking app on your phone. Visa and Mastercard cards are widely accepted, while American Express cards are accepted in the vast majority of cities and tourist areas.
Still, cash remains king when you venture off the beaten path. So if you plan on visiting places in the rural Yucatan, random villages in Chiapas, Campeche, etc, it is important to always make sure that you have a small amount of cash with you.
A lot of smaller businesses (independent convenience stores, Michoacana ice cream shops, taquerias, etc) may not have POS machines. Payments to them must be in cash only.
Since things in Mexico typically cost a lot less than what you may be used to in the US, Canada, the UK, or elsewhere, it is important to make sure that you always have plenty of small denomination notes. Small vendors may struggle to give change for 500 peso bills.
Try to make sure you always have plenty of coins and notes with a value of 100 pesos and below.
The Mexican peso is the official currency and the only real legal tender in Mexico. It is often written as MXN or with a dollar symbol ($) like you would use for US dollars, Canadian dollars, Australian dollars, etc.
Mexican pesos come in note denominations of 1000 (circa $50), 500 (circa $25), 200 (circa $12), 100 (circa $5), 50 (circa $2.50), and 20 (circa $1). Coins also come in denominations of 20, 10, 5, 2, and 1 peso.
Generally, when you exchange money for Mexican pesos or you use an ATM, you will not be given currency in denominations of more than 500 pesos. 1,000 peso notes are very rare and difficult to use to make smaller purchases.
Can I pay with US dollars in Mexico?
Due to the number of American tourists that flock to the country every year, people frequently ask if US dollars are accepted in Mexico.
Generally, no. It is better not to try and pay with American dollars (or other currencies) everywhere you go.
For the most part, businesses, restaurants, stores, etc will not accept them. However again, in areas that are popular with American tourists (Baja California, Puerto Vallarta, Cancun, Tulum, etc), you will find that some tourist businesses like car rental companies, Cancun airport hotels, and airport transfer businesses do accept US dollars.
In some tourist places like downtown Puerto Vallarta and Mahahual on the Mexican Caribbean coast, you will find ATMs that allow you to withdraw in US dollars. While this may sound convenient, it is a good idea to always check and compare the prices that you are quoted in USD and in pesos.
Sometimes the dollar rate may work out more than the rate you are quoted in Mexican pesos, so you are essentially being scammed.
Currency in Mexico exchange rates
The exchange rates for Mexican pesos vs other currencies fluctuate constantly throughout the year. However, as a general rule of thumb, you can work out the approximate equivalent of a price in Mexican pesos in USD dollars by dividing it by 20.
Check XE.com to check the latest exchange rates. As of January 2023, the exchange rates on other global currencies versus the Mexican peso are as per below.
- $1 USD – 18.93 pesos
- £1 GBP – 23.33 pesos
- $1 AUD – 13.08 pesos
- $1 CAD – 14.02 pesos
- €1 EUR – 20.43 pesos
- $1 NZD – 12.16 pesos
Exchanging money into Mexican pesos
It is always handy to purchase a small number of Mexican pesos before your trip to Mexico. That way, you aren’t scrambling around trying to find an ATM as soon as you arrive.
Consider exchanging a small number of pesos before your trip and then using an ATM to withdraw more money on arrival. Shop around as the exact exchange rate you are given can vary a lot from place to place.
Banks tend to offer the most competitive exchange rates. If you decide to go to a currency exchange, look for a place that does not charge a commission.
Once you land in Mexico, it is better to draw money from your ATM card than to exchange cash. However, if you do choose to do the latter for whatever reason, avoid currency exchanges at the airport, at hotels, and in touristy areas (e.g. Zona Romantica in Puerto Vallarta or the hotel zone in Cancun).
Their rates will not be competitive, especially not at the airport.
Open a borderless bank account before you travel
One way to cut down on the number of international charges that you may be slapped with while traveling in Mexico is to open a borderless bank account. These accounts do not charge you foreign transaction fees on international purchases and allow you to withdraw a generous amount of foreign currency each month without charge.
Opening one of these accounts is extremely worthwhile, particularly if you travel often. If you are in the US, it is worth looking into a Charles Schwab account.
Meanwhile, if you are in the UK and Europe, consider opening an account with Revolut or Wise. If you use your card in Mexico (even just occasionally to pick up the cheque for dinner), the fees for doing so can quickly add up.
$2 here and $3 there in fees doesn’t seem like much initially. But over a couple of weeks, you may find that you have lost a fair amount of money in fees.
Using ATMs in Mexico
You will find plenty of ATMs scattered around Mexico. Various banks operate here.
However, the most common ones that you are likely to see are Santander, Citi Banamex, BBVA, Banco Azteca, Banorte·, and HSBC. For numerous reasons, it is better to use ATMs that are located in the branches of banks, rather than standalone ATMs.
Bank ATMs are less likely to have been tampered with, and the bank likely has security cameras in and around the withdrawal booth. ATMs in malls, airports, bus stations, etc often charge ludicrously high fees.
Most of the time if you have an international bank card and you try to make a withdrawal at a Mexican ATM, the machine will charge you for the transaction anyway. However, in an official bank, this is often only around 40 pesos (circa $2 USD).
Some standalone machines can charge anywhere between 100 and 180 pesos. That is between $5.50 and $9.50 USD and not exactly a small amount to lose!
Then, depending on what bank card you are using, your own bank may charge you a fee for using your card internationally. Don’t assume that if you bank with a certain bank in your home country, that means that you will have favorable treatment for using the ATMs of that bank in Mexico.
For instance, HSBC ATMs often charge some of the highest withdrawal and foreign transaction fees. Even if you have an HSBC US or UK account, you may find it better to use an alternative ATM.
Making a withdrawal
Virtually all ATMs in Mexico show their displays in Spanish and English. Sometimes other languages are available too.
Remember that the rate will be displayed in pesos along with the “$” sign. So don’t panic when it looks like the machine is asking if you want to withdraw values of 3,000 or 4,000 dollars – the amount is in pesos!
Keep in mind that any withdrawal limits that are in place on your card in your home country will apply in Mexico too. It is important to find the balance between drawing out enough cash so that you are not constantly having to go back and forth to the ATM and incur extra fees, and not drawing out too much that you feel uneasy carrying it.
Drawing out sums of 2000-3000 (approx $100-$150) pesos is usually enough to do at any one time. Assuming your accommodation is paid for, or you are paying for it with your card, this amount should be enough to last you for a few days at least.
Never accept the exchange rate offered on the screen
When you are using an ATM machine in Mexico and you have decided how much you want to withdraw, the machine will often ask you if you want to be charged in Mexican pesos or in your own currency. It will then display the two separate figures.
Always decline the conversion and select Mexican pesos. The exchange rate offered by ATMs is never competitive and you will effectively lose money.
Monitor your bank statements while traveling
For your safety and security, always keep an eye on your bank accounts and statements while traveling. Most banks today have cellphone apps that mean you can easily see what is going in and out of your account on a daily basis.
These are secure, as they usually require facial recognition and/or a passcode to enter. This is as important when traveling in other countries as it is when managing your money in Mexico.
If you notice something that doesn’t look correct, you can easily report it via the app. This may not necessarily be a scam, but errors where you have been charged twice for something, etc.
Viewing your bank activity as you travel also means that you can keep tabs on what kinds of debit/credit card fees you are incurring.
How to keep your money in Mexico safe
There are a few common-sense precautions that you should follow in order to keep your money safe in Mexico. Firstly, when you need to withdraw money, be mindful of which ATMs you go to.
Preferably you should use an ATM inside a bank, or another well-lit venue. Be mindful of your surroundings and who is around you when you make a withdrawal.
Don’t carry a lot of cash with you at once. $4,000 pesos is probably the maximum amount of cash that you want to have on you at any time.
It is a good idea to have more than one bank card and to separate them. Keep one with you, along with the cash that you need for your itinerary for the day.
Keep the other safely tucked away at the bottom of your luggage, along with an emergency $50-$100 just in case you should lose your other card/wallet. These days, most banks don’t require you to notify them that you are going overseas.
However, it may be worth giving them a call or sending them a message via your online banking prior to your trip. That way, you don’t have any risk of being overseas and going to pay for something only to find out that your card is blocked.
Money in Mexico FAQs
Do you have any further questions or concerns about managing or getting money in Mexico? The answers to some frequently asked questions on the topic are detailed below.
Hopefully, you will find the answers you are looking for there. If not, feel free to reach out!
How much is $1 USD in Mexico?
$1 USD converts to approximately 19 Mexican pesos.
Is $100 a lot of money in Mexico?
Yes. $100 USD goes a lot further in Mexico than in the United States and in other western currencies. You could effectively live off this for several days in some parts of the country, as meals are available for as little as $5, and budget hotels, even in popular areas like Valladolid or Izamal, can be purchased for just $30 USD a night.
What is the best currency to use in Mexico?
Mexican pesos (MXN) are the best currency to use in Mexico. This is the national currency and official legal tender.
Some tourist places may accept US dollars but it is better not to depend on that happening.
Is it better to tip in pesos or dollars in Mexico?
When it comes to tipping in Mexico, it is preferable to tip in pesos. This is the local currency and it will be much easier for the person that you are tipping to use.
If you tip in US dollars or another form of currency, they will have to exchange it to be able to use it.
How much is $100 Mexican pesos?
$100 Mexican pesos works out at about $5.27 USD or £4.25.
Is it better to have cash or a card in Mexico?
It is better to carry a small amount of cash with you at all times in Mexico just to be safe. You should also make sure that you carry one or two cards.
(It is good to take two just in case one is locked overseas or you lose it). A credit card also obviously comes with additional insurance and is better for renting a car.
Should I get pesos at the airport in Mexico?
Absolutely not. Airports across the globe are renowned for providing the absolute worst exchange rates.
Use them at your peril. (Ok that’s a bit dramatic).
Exchanging money at an airport exchange office with an uncompetitive rate can mean that you actually lose a lot of money. The only time that you should even consider this option is if you arrive and you don’t have any cash whatsoever, and you just want to change a very small amount to get to where you are going. ($20 to $30 USD or so)
Final thoughts on managing money in Mexico
Hopefully, this article will have given you some peace of mind about managing and getting money in Mexico. If this is your first time traveling to Mexico, you might also enjoy reading these Mexico travel tips.
I have been living in the Yucatan capital of Merida for over a year now. So I am well-versed in managing money in Mexico.
Have a wonderful trip! Buen Viaje! xo