This is the first article in our Cruising Cuba series where we're looking at some things you should know before you cruise to Cuba as a US citizen, even if you're a seasoned cruiser to other destinations.
When visiting Cuba, the amazing architecture, friendly people, pristine coast, and vintage car watching are all included in the price of your cruise. Food, souvenirs, and tours however, are not. Many Caribbean destinations readily accept US dollars and credit cards, but that's not the case in Cuba, so you'll need to know how to pay for things in this unique island nation with a two-currency system.
Let's start here because it's short and simple. If you've cruised in the Caribbean before you're likely not used to changing money, as touristy spots in many Caribbean nations accept US dollars. This is not the case in the rest of the world, and for the most part it is not the case in Cuba. Some places in Cuba may be willing to accept US currency, but you can't depend on that, as most places do not. Further, paying in US dollars would result in higher prices because of a tax you'll read about below.
If you've got a credit or debit card issued by an American bank, you almost certainly will not be able to use it in Cuba. There are two exceptions; cards issued by Stonegate Bank and Banco Popular de Puerto Rico, which can technically be used on the island. If you're visiting Cuba on a cruise however, you're likely only there for a day or two, so instead of traveling to Tampa or San Juan to open an extra bank account only to find out that not many business in Cuba accept credit or debit cards in the first place, I'd reallocate that time to applying extra sunscreen, packing, or dusting your tchotchkes.
Cash is king (or as one might say, "Poderoso caballero es Don Dinero"), and there are few places you'll visit where this is as true as in Cuba. Every country uses some form of currency, but Cuba actually has two: The Cuban peso (CUP) and the Cuban convertible peso (CUC). In all likelihood, you'll be using the CUC, the value of which is linked to the US dollar and worth 25 times as much as the CUP. Interestingly, if you wanted to "sell" CUPs to get CUCs, you'd do so at a fixed rate of 24 CUPs to 1 CUC, but if you were "buying" CUCs you'd give 25 CUPs and get 1 CUC. Locals are paid in CUPs, and if you were to watch locals do business, that's what you'd see them use, though almost all consumer goods are priced in CUCs. This two currency system was adopted after the fall of the Soviet Union, which greatly complicated Cuba's international trade because of generous trade agreements in place with the Eastern bloc. These agreements being no more, lead Cuba to a major shortage of hard currency. To remedy this, Fidel Castro legalized possession of the US dollar, possession of which could previously land one in prison. This meant that goods for tourists were priced in US dollars while Cubans were still making pesos. Over time, while pesos were still accepted, all consumer goods were priced this way, until about a decade later when Cuba retooled their currency, releasing the CUC ("peso Cubano convertible"), which remained locked to the dollar. This meant prices and value didn't really change for Cubans, but they did have their own currency. Raul Castro announced in 2013 that the CUC would be phased out in favor of a single currency, though to date this has not happened.
Use of CUCs
As mentioned, as a tourist, you'll almost certainly be using the CUC, which, tied to the dollar, should make things easy. Before spending those CUCs on tours, Havana Club rum (trust me, you want this), etc you'll need to change your money to CUCs on the island. This is a simple task, as like there is a currency exchange facility in the port as soon as you go through passport control and security. You can also change currency at, Cuban banks, or CADECA locations (currency exchange houses), though the line to change currency at the port is quite quick, and rates are the same wherever you go. There are some considerations in Cuba however, that don't apply in other countries. First, before you hand over US dollars, know that there is a 10% fee for doing so, in addition to a standard 3% change fee. This means that while the CUC and the USD are 1:1, if you hand over $100USD, you'll only get $87CUC. While a 3% fee seems reasonable, as any currency exchange carries fees, 10% is a bit steep, but easily avoidable. The additional 10% fee, as mentioned, applies only to USD, which means that if you bring Canadian dollars, Euros, or Pounds Sterling, you'll save 10% when you arrive in Cuba. I mention these currencies specifically as these are generally readily available in US banks - just phone your local bank branch to ask if they have them or can get them for you - add this to your to do list a week or two before leaving on your cruise.
Do not change money with people on the street, this is an effort to scam tourists, taking advantage of the fact that the CUC and CUP look very similar, yet have very different values. If you need to change currency after leaving the port, there is a popular CADECA at the below address just outside the port:
Calle Obispo, # 257, Esquina a Compostela, Habana Vieja
The additional 10% fee, as mentioned, applies only to USD, which means that if you bring Canadian dollars, Euros, or Pounds Sterling, you'll save 10% when you arrive in Cuba. ...just phone your local bank branch to ask if they have them or can get them for you - add this to your to do list a week or two before leaving on your cruise.
Once you've got your CUCs, spend away. The spending power is similar to that of the US dollar in the US, and it should be noted that tipping customs are similar to that in the US. Once your time in Cuba is over however, you'll need to change your currency again, as CUCs and CUPs are worthless off the island. This means that even if you're in port for just eight hours, you'll need to change your currency when you arrive, and change back any remaining currency before leaving. You should also note that you can't change back coins, so you'll have some souvenirs to take home.