The convertible peso (CUC) is a closed currency, which means it cannot be purchased outside of Cuba. You can change your money at the Cadeca (money exchange bureau) at the Airport on landing in Cuba or at your hotel.
UK citizens should take Sterling cash. Clean, untorn bills of £10, £20 or £50 denomination. Please note that Scottish notes are not acceptable. The exchange rate varies on a daily basis and has fallen since September 2008. On June 22nd 2009 the rate was 1.47015 CUC to £1 which is an improvement on the lowest rate of 1.2313 on January 23rd this year. You can check the daily rate at the following link.
http://www.banco-metropolitano.com/mo...
This site gives you the accurate tourist rate of exchange you will receive at a Bank, it will be slightly lower at a Cadeca.
The cashier at the Cadeca will examine each note carefully sometimes by use of ultra violet light and also by manual inspection so it is very important that all your UK sterling notes are in good condition. Please note that no foreign coinage can be exchanged, notes only. A good recommendation is that you only exchange £10 or £20 at the Airport Cadeca as their rates are SOMETIMES lower than those at the Cadecas at your hotel. Also check the cashier's calculation, plus ask for a receipt and check the money you receive carefully and make sure it tallies with the amount shown on the receipt. Several instances of scams by the cashiers at the Cadecas (particularly the ones at the Airport) are reported regularly on this forum. Taking your own calculator, or using the one on your mobile phone, and doing your own calculation is a particularly wise move. If you are flying into Holguin, Varadero or Cayo Coco airports the Cadecas are no longer in the Arrivals Hall so if you wish to exchange some money there you will have to walk to the Departure Hall and use the Cadeca there. Do not take travellers cheques because, not only will you pay a commission when exchanging them, but if you lose them you cannot get them replaced in Cuba, you will have to wait until you return home. Also do NOT take US dollars as there is a 10% surcharge on exchanging them. This is the ONLY currency that is penalised in this way. Also avoid using the front desk of hotels to exchange money as their rate is not regulated by the banks.
The other currency in use in Cuba is the Cuban Peso (CUP). There are 24 CUP's to 1 CUC. As a tourist staying at a resort hotel you are unlikely to come across it. In fact you cannot buy it at the airport or hotel Cadecas so have no fear you will not be palmed off with Cuban Pesos instead of CUC's. Tourists can use the CUP, but it is mostly used by Cubans to pay for their rations, their electricity and water and to buy food in the markets and off stallholders in the streets and to eat or drink in 'peso' bars and restaurants. Basically you do not have to worry at all about the Cuban peso.
With regard to the use of credit or debit cards in Cuba the following applies. No card issued by a bank that has any connection with the United States will be accepted in Cuba. Therefore Capital One, American Express and MBNA cards will not work in Cuba. UK debit cards with the VISA logo are usually accepted by your tour rep to pay for trips but will NOT be accepted to purchase goods. They can, however, be used in ATM's (if you can find one and it is working) or to draw money from a Cadeca.
Much is made of the so called 11% plus charge for using your credit card in Cuba, but this is a myth. As the CUC is not traded internationally, any transaction in CUC's has first of all to be converted into $US in order for it to be charged to your card. Therefore if you spend 100 CUC it will cost $108 (100 x 8%). An exchange fee of 3% is then added so the amount actually billed to your credit card will be $111.24 (108 x 3%). When you receive your credit card statement the rate used to convert from US dollars to Sterling is the business rate which is higher than the tourist rate so that helps reduce the total transaction costs. The 10% surcharge for using US currency does NOT apply on a credit or debit card transaction, it only applies when exchanging US dollars cash.
Most UK credit cards charge a foreign transaction fee of 2.75% which they disguise in the exchange rate back to Sterling. The Post Office and Nationwide credit cards are just two of the cards that do not levy a foreign exchange fee. However the Nationwide now pass the fee that Visa charge them for the transaction onto you as from 1 June 2009 on credit and debit card transactions and it will be included in the sterling amount shown on your statement. This fee is currently 0.84% but from 1 July 2009 it will increase to 1%. Finally it is always wise to inform your credit card company of your dates of travel and to which country you are travelling to save any problems with your transactions whilst abroad.
Should you use your bank debit card to withdraw cash, the rates at participating CADECA exchange counters are processed at a rate of 1.1192. You should also be aware of the charges most UK banks apply. The following is the policy of Lloyds TSB:
Whenever you use your debit card abroad, they convert the amount to sterling using their exchange rate on the date they take the money from your account. They will also include a 2.99% foreign exchange administration fee for every overseas transaction. When withdrawing cash abroad, either at a bank or an ATM , they will charge you 1.5% of the amount withdrawn. The minimum transaction charge for this is £2.00 and the most they will charge you for each transaction is £4.50. This applies to all foreign cash transactions.
Actual transaction:
200 CUC withdrawn charged as $223.84 (200 x $1.1192) which at rate of exchange used on 21st March 2009 (USD to Sterling) of 1.4495 was £154.42 + £2.32 foreign transaction charge of 1.5% + £4.62 foreign exchange administration fee of 2.99%, thus making a total cost of £161.36 so UK bank charges added another £6.94 to the cost, roughly another 9 CUC's.
With regard to withdrawing cash on your credit card the charges imposed by Thomas Cook on their credit card are as follows: 2.5% foreign exchange fee for all cash withdrawals abroad plus an additional 2.99% cash handling fee. On top of this interest charges apply from the date of the transaction.
