Understanding Mexican currency
Mexico receives tens of millions of international tourists each year. In 2024, total arrivals reached around 45 million, with travelers from the United States accounting for a significant share (around 13.5 million).1 In popular destinations like Cancún, American and Canadian tourists represent a substantial portion of the visitor population. Not only is that a lot of foot traffic, but a lot of monetary traffic as well.
If you’re planning to be one of those tourists, you’ll have to consider the currency used in Mexico before making any travel plans. U.S. dollars may be accepted in some tourist areas, but they’re not legal tender, and you’ll generally get better value if you use Mexican pesos.
The Mexican peso (MXN) is the country’s official currency—one of the oldest in the Americas—and it remains widely used in international trade and money transfers today. For those sending money to Mexico, BOSS Money makes the process even easier, allowing you to send U.S. dollars, which recipients can convert to pesos at a favorable rate.
If you want to know more about the money used in Mexico (and where or when U.S. dollars may be accepted), this article is for you.
What is the currency in Mexico?
If you’ve ever wondered what Mexican money is called or what MXN stands for, it refers to the Mexican peso. Denoted by MXN or MX$, it’s the official currency used in Mexico. It’s issued by the Banco de Mexico (Bank of Mexico)2, serving as the country’s legal tender for everyday transactions and big purchases alike.
The peso’s link to silver lasted for several centuries until the 20th century, when the value of the peso began to fluctuate with broader economic factors. The Mexican peso shares some similarities with the U.S. dollar system: 1 Mexican peso is equal to 100 centavos, like how a U.S. dollar can be divided into 100 cents.
Despite volatility, the Mexican peso is known for its high liquidity and is one of the most traded currencies globally, with recent circulation including improved security features and designs showcasing Mexico's heritage.
What does MXN mean?
All currencies in circulation follow the international currency code defined by ISO 4217, an international standard that assigns codes to currencies. This is where the MXN designation of the Mexican peso comes from. MXN is the official code you’ll see on money transfer apps, ATMs, and exchange rate charts.
Before 1993, the international currency code for the Mexican peso used MXP3, but this was changed to MXN after Mexico underwent significant economic reforms to stabilize and modernize its monetary system. It’s unlikely that you’ll encounter any places in Mexico still using the MXP currency code. It’s also not advised to conduct your transactions with that code to avoid confusion during monetary transfers.
How do pesos work?
Like the U.S. dollar, the Mexican peso also consists of both banknotes and coins. You’ll likely encounter banknotes when exchanging USD to MXN outside of Mexico and coinage when you’ve settled in the country. However, having a healthy balance of both types of currency is important to navigate and pay for goods and services in Mexico smoothly.
Banknotes/bills
Here’s an overview of the banknote denominations (G-type) you might encounter and use:4
- 20-peso banknote: Features a fragment of the artwork titled "Solemne y pacífica entrada del Ejército de las Tres Garantías a la Ciudad de México el día 27 de septiembre del memorable año de 1821,” showcasing the historical process of Mexico's Independence
- 50-peso banknote: Features several fragments of artworks representing the historical period of Ancient Mexico, such as the "Teocalli de la guerra sagrada" and the “La gran tenochtitlan (vista desde el mercado de tlatelolco)”
- 100-peso banknote: Features Sor Juana Inés de la Cruz, the most important poet/writer of Novo-Hispanic literature
- 200-peso banknote: Features Miguel Hidalgo y Costilla and José María Morelos y Pavón, important figures in Mexico’s independence
- 500-peso banknote: Features President Benito Juárez, who issued the Laws of Reform and was proclaimed “Benemérito de las Américas” (distinguished hero of the Americas)
- 1,000-peso banknote: Features Carmen Serdan, Hermila Galindo, and Francisco I. Madero, key figures in the Mexican Revolution
In addition to these famous figures, the banknotes also include representations of Mexico’s diverse wildlife and national heritage, further showcasing the country’s rich culture and history.
An interesting feature of modern Mexican banknotes is that the lowest denominations (20-, 50-, and 100-peso bills) are now made of polymer, a type of durable plastic. This new material makes the bills more wear-resistant and longer-lasting compared to the traditional paper notes. Polymer notes also resist dirt and moisture, which is useful in a country where coins and bills are still more popular than cashless transactions.
Coins
The coins in circulation in Mexico come in 1, 2, 5, 10, and 20-peso denominations. They’re commonly used for small daily transactions, such as public transportation, street food, or market purchases.
In addition to the standard coins, there are also centavo coins, which represent fractional amounts of a single Mexican peso. There are 5, 10, 20, and 50-centavo coins. They make up the subunit of the national currency, similar to how pennies or nickels are used in the U.S.
Can you use U.S. dollars in Mexico?
In many tourist-heavy areas such as Cancún, Playa del Carmen, or Cabo San Lucas, USD may sometimes be accepted by merchants, hotels, and vendors. However, there are three important reasons why you should avoid using US dollars when paying for goods and services in Mexico:
When paying with U.S. dollars, the exchange rate used by the merchant may not be as favorable as the official Mexico-peso-to-dollar rates. The transaction may be conducted at an exchange rate that benefits the business, meaning you could receive less value for your money than the official rate would provide.
While you might pay in U.S. dollars, any change you receive will be in Mexican pesos. You’ll end up with pesos in your wallet either way, so it’s more practical to simply convert your dollars into pesos to begin with.
In more rural or less touristy areas, U.S. dollars are not accepted. That’s why it’s crucial to always have some MXN on hand when traveling outside of major tourist areas.
If you’re sending money to Mexico, use a licensed provider like BOSS Money to lock in a transparent USD-to-MXN exchange rate. Not only does using a service like BOSS Money provide a transparent and competitive exchange rate, but your funds also arrive quickly and without hassle.
Should I exchange money in the U.S. or Mexico?
So is it better to exchange money in the U.S. or Mexico? If you’re wondering where to get pesos before your trip, there are some pros and cons to consider for exchanging money in either country:
Exchanging in the U.S.
It’s convenient and safe to exchange money before your trip, and you can avoid the hassle of searching for an exchange service upon arrival in Mexico. You can also plan your budget in advance since you’ll know the exact amount you’ll have in pesos.
The exchange rate is often less competitive than the rates offered by exchange services in Mexico. Transaction or service fees may be higher, which could result in you receiving fewer pesos for your dollars. Additionally, political factors may affect the overall exchange rate.
Exchanging in Mexico
Exchange services in Mexico often offer better exchange rates. For example, withdrawing pesos directly from a local ATM typically results in more pesos for your dollar. There’s also a wide variety of exchange options, like local banks and exchange houses.
Exchanging money at airports can be suboptimal, as airport exchange counters often charge higher fees. ATM fees can also apply, depending on your bank. To reduce additional charges, use ATMs that belong to major banks.
For most travelers, it’s best to exchange small amounts of USD at the airport for immediate needs (such as transportation or a quick meal). After that, you should use ATMs or money transfer apps to get the best rates for MXN.
You can also try sending money to yourself via services like BOSS Money. Aside from immediately turning your USD into MXN, you also get lower fees than you might pay at airports or banks.
Tips for using money in Mexico
Here are a few practical tips you can follow to make sure your pesos are used wisely while you’re in Mexico:
When paying with larger bills, always double-check that you receive the correct amount of change. Mistakes can happen, and it’s better to catch them immediately.
Avoid standalone or private ATMs, which may have high fees, offer unfavorable exchange rates, or may even be tampered with. Instead, use ATMs located in large bank branches.
In more rural or remote areas, it may be difficult to get change for large bills, so try to carry smaller denominations like coins when possible.
When exchanging money, always keep your receipts. You may be asked to show them when departing Mexico as part of customs checks.
Familiarize yourself with the current exchange rate before you arrive to ensure that you don’t overpay for goods or services. Using licensed money transfer services like BOSS Money can make this easy.
Conclusion
Overall, the Mexican peso can be a relatively easy currency for U.S. tourists to use and navigate. The main consideration isn’t simply converting your USD into MXN but ensuring that every exchange is conducted at a fair rate.
Remember that while U.S. dollars are sometimes accepted, they’re not used everywhere in Mexico. The best way to get pesos is by exchanging your money through trusted services. Compare rates and avoid hidden fees before traveling or transferring, and ensure that you always have MXN on you.
Whether you're sending money to family or preparing for a trip, BOSS Money helps you transfer USD to MXN securely, transparently, and at great rates.
Sources: all third party information obtained from applicable website as of October 20, 2025
- https://roadgenius.com/statistics/tourism/mexico/
- https://www.banxico.org.mx/banknotes-and-coins/d/%7BB8C0D87B-F55F-792A-A6C6-FC0F58CF2EA3%7D.pdf
- https://www.leftovercurrency.com/exchange/mexican-pesos/obsolete-old-mexican-peso-banknotes/
- https://www.banxico.org.mx/banknotes-and-coins/currently-banknotes-and-coins.html
This article is provided for general information purposes only and is not intended to address every aspect of the matters discussed herein. The information in this article is not intended as specific personal advice. The information in this article does not constitute legal, tax, regulatory or other professional advice from IDT Payment Services, Inc. and its affiliates (collectively, “IDT”), and should not be taken or used as such by any individual. IDT makes no representation, warranty or guaranty, whether express or implied, that the content in this article is current, accurate, or complete. You should obtain professional or other substantive advice before taking, or refraining from, any action on the basis of the information in this article.
