What Type of Money Does Puerto Rico Use?
Understand Puerto Rico's currency, its seamless integration into daily life, and the familiar financial system.
Puerto Rico, a territory of the United States, uses the United States Dollar (USD) as its official currency. Travelers and residents conduct all financial transactions using the same bills and coins found across the mainland U.S. Understanding this monetary system is helpful for anyone planning to visit or reside on the island.
Official Currency of Puerto Rico
The official currency throughout Puerto Rico is the United States Dollar. This monetary alignment stems from Puerto Rico’s political status as an unincorporated territory of the United States, which integrates it into the U.S. economic and financial framework. All denominations of U.S. currency, including paper bills and coins like pennies, nickels, dimes, and quarters, are universally accepted and circulated.
Puerto Rico adopted the U.S. dollar following the Spanish-American War in 1898. By 1904, the U.S. dollar was established as the official tender, replacing previous currencies. Locals sometimes use traditional terms like “peso” for the dollar or “chavos” for cents, reflecting the island’s Spanish heritage.
Using Money in Daily Life
Credit and debit cards are widely accepted in Puerto Rico, especially in urban centers and tourist-heavy areas. Major card networks such as Visa, Mastercard, American Express, and Discover are processed at hotels, restaurants, and larger retail establishments. This widespread acceptance mirrors payment habits in the mainland U.S.
Automated Teller Machines (ATMs), often referred to locally as ATH machines, are available across the island for U.S. dollar withdrawals. Cash remains a frequently used payment method, particularly for smaller transactions, at local markets, from street vendors, or in rural regions. Carrying some cash is advisable.
Tipping practices in Puerto Rico are similar to those in the mainland U.S., with a customary range of 15% to 20% for service at restaurants. It is prudent to review bills for any service charges already included, especially for larger groups, to avoid double tipping. Puerto Rico has a Sales and Use Tax (SUT), known as IVU, which currently stands at a combined rate of 11.5%, comprising 10.5% for the Commonwealth and 1% for municipalities. Food items are subject to a 7% sales tax.
Financial Infrastructure and Services
Puerto Rico’s financial system is deeply integrated with that of the United States, operating under a framework that combines local and federal regulations. The banking sector in Puerto Rico includes both U.S. national banks and locally chartered institutions, all subject to oversight that aligns with U.S. federal banking laws. The Office of the Commissioner of Financial Institutions (OCIF) in Puerto Rico serves as the primary local regulatory body, adhering to examination guidelines set by the Federal Financial Institutions Examination Council (FFIEC).
Puerto Rico relies on the U.S. Federal Reserve System for central banking functions and monetary policy. Financial services available on the island, such as online banking and mobile payment options, largely mirror the offerings found throughout the mainland U.S. U.S. federal anti-money laundering (AML) and counter-financing of terrorism (CFT) legislation, including the Bank Secrecy Act and the Patriot Act, apply in Puerto Rico.