Markets and Trade, Money

Cash, Please

Money in Mexico

Cashless forms of payment for retail purchases have overtaken paper and coins in the USA, Canada, and much of Europe.

However, cash in notes and coins remains king in Mexico, whether you are buying food, goods, or services—even with the recent surge here in adoption of electronic banking services.

The use of credit and debit cards is widespread in Mexico — with payments using smartphones nascent — and although working-class Mexicans are increasingly using plastic cards, cashless payments are predominantly made by the middle and upper social classes.

At least half of Mexican households still don’t have a bank account, and rely entirely on the country’s cash-based economy for their trades. Online banking is gradually being taken up, but there remains a natural (cultural) preference for cash use, underlined by a Bank of Mexico study revealing that a significant majority of Mexicans with debit cards use them simply to withdraw their wages in cash from ATMs. Cash thus remains the widely employed—and oftentimes preferred—form of payment in Mexico.

Here is a summary of everyday situations where cash and cashless payments are currently used in Mexico:

Taxi Fares: Some taxi firms in Mexico City will open an account for you and accept payment using a debit or credit card, although with the advent of App-Cab services like Uber and Cabify, fares are billed to your credit or debit card anyway. Independent street taxis, and local cabs operating in smaller towns and villages across the country will only accept cash.

Car Fuel: Gasoline stations now offer card payment options (non-Mexican bank cards might be problematic, we have mixed reports), but many people still pay with cash to fill the tank. It’s wise to make sure you have some cash with you on your journey in case the station you stop to refuel at doesn’t accept cards, or their card payment system is off-line.  We also strongly recommend that if you use plastic to pay for gasoline in Mexico, use a credit card instead of a debit card: if your debit card is cloned, it’s very difficult to get stolen money back from it.

Tolled Roads: Booths on tolled highways across Mexico accept plastic, and drivers who often use tolled roads will buy a “tag” to place in their windshield which can be prepaid, or linked to a credit card. As with gasoline stations, it’s wise to carry some cash on your journey in case the toll booths you pass through don’t accept cash or their electronic payment system is off-line.  If you plan to use Mexico City’s “second level” ring-road system, you’ll need to purchase a windshield tag and prepay a balance to it, or link the tag to your credit card; cash is not accepted.

Electricity Payments: Most people pay their bi-monthly electricity bills using cash, although electronic payments using online banking are becoming increasingly common; also, the electricity company’s ATM stations where electricity bill payments are accepted will take cash or bank cards in payment.

Natural Gas: Payments for delivery of natural gas to residential homes are often settled using cash. In Mexico City, you can have gas piped into your home in certain neighborhoods and the company that supplies that gas will accept various forms of e-payment in addition to cash. However, the overwhelming majority of residents in Mexico have a gas tank (portable tanks or the type that are installed on the roof of the home) which are filled by passing gas-tanker trucks. Most gas distribution companies now take card payments in addition to cash; however, you should tip the tanker-truck operators in cash.

Situations in Mexico where CASH-LESS payments are readily accepted

All major supermarkets and department stores, shopping mall stores, most restaurants in bigger towns and cities, main car dealerships, furniture and electrical goods stores, some food and beverage chains (like Starbucks), bus companies, travel agencies, professional services (e.g. doctors, dentists, lawyers), and pretty much all other businesses catering specifically to the middle and upper classes actively accept payment by credit and debit card, and some also accept smartphone payments. Mobile phone companies will allow you to top-up your prepay phone balance using a credit or debit card—online, or directly using your phone.

Situations in Mexico where CASH is still required

There are many instances in Mexico where only cash will do: local independent convenience stores; open-air markets; independent street cabs, shoe-shine stalls; buying trinkets from ambulant vendors; street food; confectionery, newspapers or tobacco purveyed by corner stalls; buying anything in small shops and stalls in rural towns and villages; paying your domestic help (e.g. maid, gardener, pool maintenance). Some trades people, for example, plumbers, electricians, and carpenters will accept cashless payments for larger jobs in the form of a money transfer to a local bank account, but the majority of routine jobs—especially ad-hoc work like fixing a leaking tap—are strictly on cash terms.

Vacation Souvenirs: When touring, cash is essential to get around on local transport, and to buy local souvenirs or anything from street traders or stores ‘off the beaten track’.

Tipping: Cash is also essential for tipping in Mexico.  You should always tip in cash and in Mexican pesos only – our guide to tipping explains why.  If you visit Mexico on a tour package and spend your entire stay at a resort, then you may not have a call to use much cash (although note above about tips); but most visitors discover that at least a few occasions arise where the use of physical cash is an absolute necessity.

Notwithstanding the increase of cashless payments in Mexico, if you’re just visiting, or living here, you’ll soon discover that in practice there is a constant and continuous need for cash as you go about your days, and you might also find that making change is a continual pastime.

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