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Money Matters

Updated: June 2021. Cuba removes the CUC from circulation and returns to a single currency economy. 

After nearly 30 years of managing two currencies in one economy, 2021 is the year that Cuba finally takes steps to return to a single currency economy.

On the 1st January 2021 the Cuban Government initiated a 6 month period of monetary unification  ( known officially as Tarea Ordenamiento ) and is gradually removing the CUC from circulation, leaving the CUP (Cuban Peso) as the sole Cuban currency.  The CUC will cease to exist on 1stJuly 2021, marking the end of Cuba’s dual-currency system, but can be used or exchanged into CUP until that date with a fixed rate of CUC1:CUP25.

As a reminder, the CUC was initially created in 1994 to eliminate the rampant circulation of USD within Cuba and was pegged CUC1:USD1.  The USD had become the currency of choice within Cuba after the Soviet Union collapsed and withdrew support from Cuba, creating economic freefall on the Caribbean island.   The CUC was, in essence, a US dollar dressed in Cuban clothing and enabled the Cuban Government to control hard currency circulating on the island.  It has been used in Cuba for the purchase of all imported goods ( including food, clothing, electronics, building materials ), services and any tourism-related cash transactions.. Travellers would typically exchange GBP/EUR/CAD/AUD in cash for CUC upon arrival or withdraw CUC directly from ATMs using their foreign debit cards.

Concurrently ,the CUP, aka Moneda Nacional or Peso Cubano, has been the base currency of the Cuban economy and the one used for all economic planning and transactions as well as being the currency  in which Cubans receive their salaries, buy their food and pay for utilities and public transportation.  The CUP has now returned to being the sole domestic currency in Cuba, with an official exchange rate of USD 1 : CUP 24

The US Dollar in Cuba 

Until late 2020, any USD currency exchanges in Cuba were subject to an additional 10% tax so it wasn’t a good idea to bring US Dollars in to the country. This tariff was briefly removed by the Cuban authorities, before being replaced a few months later by a total ban on exchanging USD cash (June 2021). It is therefore not advisable to travel with USD to exchange, and instead travellers should bring an alternative currency (e.g. GBP/EUR/CAD/AUD) to exchange locally for CUP.

Many Cuban supermarkets, and small shops within hotel premises, have stopped selling goods in both CUC and CUP.  In a much needed attempt to start digitalizing the Cuban economy, these shops now only  accept bank card payments with prices expressed in USD.  Cash payments are no longer possible in these shops. Foreign debit and/or credit cards can be used, however it’s important to inform your bank of travel plans prior to making transactions in Cuba to ensure that your card will work.

 

What do these changes mean for travellers coming to Cuba in 2021?

  • Travellers will now use the CUP currency for all cash transactions.
  • When withdrawing cash from ATMs using international debit cards, CUP cash is now dispensed.
  • All traveller expenses in Cuba (e.g. meals, drinks, tips, optional activities, souvenirs etc.) should be calculated in CUP
  • Most shops selling food or clothing ( and all shops within hotel establishments )  will accept card payments only, not cash, with prices advertised in USD.
  • It is prohibited to take CUP currency out of Cuba ( it is recommended to change back any unused CUP before arriving at the airport )
  • Transactions in the airport waiting area also need to be in a foreign currency.