The Mexican Peso: An Essential Guide

Last updated on March 4th, 2024 at 02:21 am

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The Mexican Peso

Whether you are sending money home to Mexico or planning a vacation there, you may want to turn your U.S. dollars, Canadian dollars, British pounds, or other currency into Mexican pesos. While you might already know that the Mexican peso is the national currency, you may not know that Mexican currency used to be widely accepted as legal tender in the U.S., Canada, and even some Asian nations. 

The fact is, the Mexican peso isn’t just banknotes and coins. It also serves as a link to history in the Americas. Keep reading this guide created by our team at Remitly to learn more about the Mexican peso, from fun facts to practical considerations.

About the Mexican Peso

The Mexican peso is the official currency of Mexico and is the third-most-popular currency in the Americas, after the United States dollar and the Canadian dollar. Its roots trace back to Spain, and it was the first currency to introduce design measures to prevent counterfeiting. 

MXN is the currency code for the Mexican peso. One Mexican peso can be divided into 100 centavos. Abbreviations for Mexican pesos include $ or Mex$, and the ¢ sign is used for centavos.

The Bank of Mexico issues the Mexican peso. It prints all of the peso banknotes, while the Casa de Moneda de México mints peso and centavo coins.

The Mexican peso has several local nicknames, including “lucas,” “lana,” “marimba,” “money,” “morlacos,” “papiros,” and “varos.” 

Mexican peso denomination information

There are both peso and centavo coins in circulation. Overall, Mexican coins include the following denominations:

  • 5 centavos
  • 10 centavos
  • 20 centavos
  • 50 centavos
  • 1 peso
  • 2 pesos
  • 5 pesos
  • 10 pesos

mexican peso

Mexican banknotes are also used throughout the nation. The current denominations for banknotes include:

  • 20 pesos
  • 50 pesos
  • 100 pesos
  • 200 pesos
  • 500 pesos
  • 1,000 pesos

The 1,000-peso banknote is rare, but it does exist.  If you do come into contact with one, know that most small stores will not accept it because they will not be able to make change for it.

Related: The best ways to send money to Mexico

A Short History of the Mexican Peso

The peso originated in a common coin imported from Europe during colonization called the “Spanish dollar.”

This coin was made of silver and worth eight Spanish real. The coin was also known as “a piece of eight” for that reason. In Mexico, the coin came to be called the “peso.”

For decades after Mexican independence from Spain occurred in 1821, the Mexican government continued to use the Spanish monetary system.

In 1823, the first banknotes were printed in the country. The first one-peso coin was issued in 1866 under Emperor Maximilian I. Departing from the tradition of the reales, each peso was made up of 100 centavos.

Gradually, the gold and silver content of the coins was replaced with less expensive metals. In 1905, the gold content of the coin was reduced by nearly 50%. This was followed by a reduction in silver. From 1918 to 1977, the weight and fineness of all silver coins declined until the last silver coins were issued in 1977.

Throughout most of the 20th century, the Mexican peso was one of the more stable currencies in Latin America. However, the late 20th century was difficult for the Mexican peso. The 1970s oil crisis devastated the Mexican economy. Not only did Mexico default on its national debt, but wealth left the country, and the peso suffered from inflation.

The government later stepped in to create the economic strategy known as the Stability and Economic Growth Pact. They introduced the nuevo or new peso in 1993 to combat further devaluation. A single nuevo peso equaled 1,000 old pesos.

Once the old notes and coins were out of circulation in 1996, the currency dropped the term “nuevo.” 

7 Facts You Might Not Know About the Mexican Peso

mexico peso

While you might think that currency is straightforward or boring, every coin or banknote has a story. This is especially true for a currency that has been in use for as long as the Mexican peso. 

Below are a few of our favorite facts about Mexican currency.

1. Peso literally means “weight.”

Peso is Spanish for “weight.” This word can be traced back to the Latin “pensum,” meaning “something weighed,” from the verb “pendere,” meaning “to weigh.”

When you consider that the peso used to be made of precious metals like gold and silver, it makes sense that the coin would be valued by weight.

This is also why pesos were commonly referred to as peso oro (gold weight) or peso plata (silver weight).

2. The Mexican peso and the U.S. dollar have a shared history.

It’s easy to see the “$” sign and think of the U.S. dollar, but the Mexican peso first used the “$” symbol for their coins!

The “$” sign is thought to originate from the abbreviation “PS,” which was used to denote Spanish pesos in the Americas.

Mexican currency uses the same symbol as the dollar because they share a common history. During the colonization of the Americas, Spain had the largest supply of silver — which is why the original peso was made from silver.

The U.S. dollar was created in 1792, establishing the dollar as the principal unit of currency in the United States. It was modeled after the peso because of the peso’s international reputation and stability. Even after the dollar was created, the peso was still legal tender in the United States until 1857.

modeled after the peso because of the peso’s international reputation and stability. Even after the dollar was created, the peso was still legal tender in the United States until 1857.

3. The Mexican peso was an early model currency.

The Mexican peso was not only issued before the American dollar, but it also inspired the dollar’s design. Because of its resistance to counterfeiting, the peso was extremely popular during the 19th century.

It’s no surprise that many global currencies took their design cues from the peso. These included the Hong Kong dollar, the Japanese yen, and the Chinese yuan.

4. The first banknotes weren’t printed domestically.

While the Bank of Mexico prints the modern-day peso, that wasn’t always the case. In their first round, the Mexican peso was printed by the American Bank Note Company of New York (ABNC) from 1925 to 1934. 

The Bank of Mexico told ABNC what they wanted on each note and sent images from their archive when possible.

Today, this is who you’ll find on some peso banknotes:

  • $1,000: Miguel Hidalgo, the Mexican hero who initiated Mexican independence

  • $500: Benito Juárez, the former Mexican president who was the first Mexican president of indigenous origin

  • $200: Both Miguel Hidalgo and José María Morelos y Pavón, leaders and revolutionaries

  • $100: Nezahualcóyotl, a philosopher, architect, poet, ruler, and warrior

  • $50: José María Morelos, Mexican Roman Catholic priest and revolutionary

  • $20: Former Mexican president Benito Juárez


5. It’s really hard to make counterfeit pesos.

Peso banknotes are designed and printed to prevent counterfeiting. For example, every note has a hidden watermark, holographic threads, and micro-prints.

Furthermore, except for the $20 and $50 notes, all notes are printed on special banknote paper. This has the same feel or texture as U.S. or Canadian dollars. 

The newest notes are made of plastic composite, making them very difficult to replicate.

6. The peso is a liquid currency.

The Mexican peso is a formidable currency in the international currency and commodities market for three reasons: 

  1. Mexico has historically had higher interest rates than the U.S., which can attract funds into higher-yielding Mexican government bonds and investments. 
  2. Its physical proximity to the U.S. means those border towns engaging in commercial interactions significantly increase the liquidity of Mexican currency.
  3. The nation is one of the largest oil producers in the world, contributing to international trade while allowing the nation to finance its domestic endeavors.

7. There have been commemorative banknotes issued in the past.

Just as there have been commemorative US dollar notes and other banknotes issued in the past, special editions of Mexican pesos have been unveiled over the years.

One example was the Type F 200 pesos note released on September 23, 2009, in honor of the bicentennial anniversary of the Mexican War of Independence. The obverse side showed a portrait of Don Miguel Hidalgo, and the reverse side featured an image of the Columna de la Independencia monument.

Recommended reading: What Countries Use Dollars?


Peso-to-Dollar Conversion

The exchange rate is an important consideration when converting MXN to USD or vice versa. Exchange rates tell you how much of one currency you can buy with another.

For example, say the dollar exchange rate with MXN is 1 USD = 16.84 MXN, and you want to exchange 100 USD for MXN. The calculation based on the dollar exchange rate would be:

100 USD x 16.84 = 1684 MXN

In other words, you’d receive 1684 Mexican pesos for your 100 US dollar bill.

Exchange rates fluctuate from hour to hour and day by day as the values of currencies change. As a result, it’s important that you find out the current exchange rate and compare rates between providers when you want to send money abroad.

Also, remember that someone receiving a money transfer from you typically won’t get the full amount you exchanged. This is because money transfer services and banks usually charge currency conversion fees.

Check out today’s rates with Remitly for current peso-to-dollar exchange rate information.

To learn more about how exchange rates are calculated, this guide to exchange rates answers all of your questions.

About Mexico

The United Mexican States, as it is officially known, is a large country located in southern North America and is the third-largest nation in Latin America. Sharing a northern border with the United States of America and a southern border with Belize and Guatemala, the country is home to over 128 million people. The federal republic is made up of 32 states. 

The federal government is housed in the capital and largest city, Mexico City. The capital is one of the most populous (at 8.5 million) and most metropolitan cities in the world. 

More than half the nation’s population lives in the central region, whereas the arid areas to the north and tropical regions to the south are sparsely populated.  

Mexico is one of Latin America’s dominant economic, political, and social forces. It has a rich and diverse heritage due to its physical environment, a mixture of ethnicities, and settlement histories.

The Mexican population is as diverse as it is large: 62% of the population identifies as mestizo (or mixed race, often of Spanish and indigenous descent), 7% identify as indigenous, and 31% identify as being from another ethnic group. 

Spanish is the official national language spoken by the vast majority of the population. While less than 1% of indigenous Mexicans speak their ancestral language, more than 50 indigenous languages are spoken by more than 100,000 people in the nation. These include Maya in the Yucatan; Huastec in Veracruz; Nahua, Tarascan, Totonac, Otomí, and Mazahua mainly on the Mesa Central; Zapotec, Mixtec, and Mazatec in Oaxaca; and Tzeltal and Tzotzil in Chiapas.

While no official Mexican religion exists, over 82% of Mexican people are Roman Catholic, with smaller populations of other Christian sects. 

Tourism continues to grow, with many people flocking to its tropical beaches along the Pacific and Atlantic coasts. Mexico is also known globally for its holidays and traditions, like Día de los Muertos (Day of the Dead) and many holidays associated with the Christian religion, such as Carnaval, Easter, and Christmas. 

Sending Money to Mexico

You can send money to Mexico with Remitly. New customers may be eligible for a special offer on their first transfers.

Remitly makes international money transfers faster, easier, more transparent, and more affordable. Since 2011, over 5 million people have used our secure mobile app to send money home with peace of mind.

And with our coverage across the nation from coast to coast, your recipients can pick up cash from familiar locations. These include OXXO, Elektra, Bancoppel, and more. You can also send money directly to a Mexican bank account or debit card.