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When planning your dream vacation to Mexico, one of the most important things to consider is the currency. Understanding the currency in Mexico will help ensure smooth transactions throughout your trip.
What is the currency in Mexico?
The official currency of Mexico is the Mexican Peso (MXN), represented by the “$” sign. One peso is divided into 100 centavos, much like cents in the US dollar. While US dollars are sometimes accepted in tourist areas, it’s always advisable to use Mexican Pesos to get the best value for your money.
As you travel through Mexico, you’ll encounter various denominations of both coins and banknotes. Coins range from 5¢ to $20 pesos, and banknotes include $20, $50, $100, $200, $500, and occasionally $1,000 pesos. Though US dollars may be accepted in certain places, relying on the local currency is your best bet to avoid unfavorable exchange rates.
Currency Exchange Tips for Travelers
When exchanging your money, it’s important to know where to go for the best rates. Avoid exchanging currency at airports or hotels, as these often charge higher fees. Instead, use banks or reputable exchange offices in major tourist areas for better rates. Check out our blog on the best Mexican Cities to Visit. Each of these will have plenty of options when looking for reputable places to exchange money.
For those looking to avoid hidden fees and ensure the best value when spending abroad, we recommend using Wise. This service allows you to load funds in your home currency and convert them to Mexican Pesos at the real-time exchange rate. You can even withdraw cash from ATMs with no foreign transaction fees, making your experience more seamless and cost-effective.
Additionally, Oanda is an excellent tool for checking currency conversion rates before you travel, ensuring that you’re always aware of the current exchange rate.
Cultural Insights into Currency Use in Mexico
Understanding how currency is used in Mexico goes beyond just knowing the exchange rate. There are some cultural nuances that can make your experience more enjoyable and avoid any awkward situations.
Tipping in Mexico
Tipping is a common practice in Mexico, and it’s essential to know when and how much to tip in order to show appreciation for good service.
- Restaurants: In sit-down restaurants, tipping is expected, and it’s generally between 10% and 15% of the bill. If the service is exceptional, you can go up to 20%. In smaller, more casual eateries, tipping is not obligatory, but it’s appreciated.
- Hotel Staff: Hotel staff, such as bellhops and housekeeping, typically receive small tips of around $20 to $50 pesos, depending on the level of service.
- Taxis and Drivers: Taxi drivers typically don’t expect tips, but rounding up the fare or offering a small tip is always appreciated. If you have a private driver, consider tipping 10% of the fare.
- Street Performers and Tour Guides: For street performers or local guides, small tips in pesos are customary. A tip of $20 to $50 pesos is a thoughtful way to acknowledge their talent or service.
It’s important to note that US dollars are sometimes accepted as tips, particularly in touristy areas. However, it’s usually preferred to tip in pesos to avoid conversion issues or unfavorable exchange rates.
History of the Mexican Peso
The Mexican Peso has a rich history that dates back to the Spanish colonial era. The currency has undergone significant changes, but it remains a symbol of Mexico’s heritage and economic evolution.
- Origins: The Mexican Peso originated from the Spanish dollar, which was widely used throughout the Spanish colonies in the Americas. The term “peso” comes from the Spanish word for “weight,” as the original Spanish coins were large and heavy.
- Early History: In 1785, the Spanish government set the value of the peso on par with the Spanish dollar, which was the currency used in the United States until 1857. Over time, the Mexican peso became the official currency of Mexico after the country gained independence from Spain in 1821.
- Centavos: The first centavos (smaller coins) were introduced in 1863 at one-hundredth of a peso, further dividing the currency and making it more practical for daily transactions.
- The “Nuevo Peso” Era: In 1993, to combat extreme inflation, Mexico introduced the nuevo peso (new peso). The government dropped three zeros from the currency, making one nuevo peso equivalent to 1,000 old pesos (MXP). Today’s MXN (Mexican Peso) is the modern version of the nuevo peso and is used across the country.
Despite its fluctuations over the years, the Mexican Peso remains one of the most stable and widely used currencies in Latin America. It is directly influenced by Mexico’s strong relationship with the United States, as well as global commodity prices, particularly oil, which is a major export of Mexico.
Mexico Currency Exchange Tips for Travelers (Continued)
When exchanging your money, it’s important to know where to go for the best rates. Avoid exchanging currency at airports or hotels, as these often charge higher fees. Instead, use banks or reputable exchange offices in major tourist areas for better rates.
For those looking to avoid hidden fees and ensure the best value when spending abroad, we recommend using Wise. This service allows you to load funds in your home currency and convert them to Mexican Pesos at the real-time exchange rate. You can even withdraw cash from ATMs with no foreign transaction fees, making your experience more seamless and cost-effective.
Additionally, Oanda is an excellent tool for checking currency conversion rates before you travel, ensuring that you’re always aware of the current exchange rate.
Conclusion
By understanding the currency in Mexico and preparing in advance, you’ll be able to enjoy your travels without worrying about currency exchange. Make sure to always carry some Mexican Pesos for everyday expenses and consider using a Wise travel card to manage your finances with ease.
Also, learning about the history and cultural norms surrounding currency will help you engage more deeply with the local culture and make your visit even more enriching. Safe travels, and enjoy the vibrant culture, beautiful beaches, and unforgettable experiences Mexico has to offer!
Looking for a villa to rent in Mexico? Our team are here to assist you. Contact us to start planning today.
About Linda Browne
Linda is the General Manager for Exceptional Villas and has an in-depth knowledge of the travel industry. Linda's qualifications are in the area of business, marketing and tourism. Linda travels for much of the year inspecting all of our luxury villas; the majority of her time is spent in the Caribbean and Europe.
