Spending USD in Mexico
 

My friend travels to Mexico frequently with her adult daughter to buy various things for her import shop in the US. She told me that it is impossible (as far as her experience went) to spend or change USD outside the airport. Due to money laundering/drug trade, the US dollar is not accepted anyplace. She advised changing any dollars at an exchange in the airport (Mexico City) and then using ATMs for cash after that. Has anybody else had this same experience?

I can only speak for the Riviera Maya area of Mexico, but the still take US$$ at most places and there are cambios to change to pesos in various places. You are not limited to the airport when it comes to converting your $$$.
With the exchange rate the way it is now you will be better deals using pesos.

I'm not sure why people would want to use USD instead of pesos on a buying trip but I've seen people use USD in well touristed areas. I also see many money exchange places and banks that do this, as well. Most of us use ATMs.

We get pesos through an ATM when we arrive at the airport. If we need additional money, we've never had a problem finding an ATM in whatever area of Mexico we were in. If your friend is experiencing problems using US Dollars, it may be due to the amount she is spending. I think there are rules about the maximum amount of US dollars you can use per transaction. Also, hotels no longer exchange currency (at least that has been my experience).

If you wish to pay up to 30% for purchases including food use dollars. If Not use a Bank ATM to obtain pesos.
PS It is essential you notify your bank of your travel dates or your account will most likely be frozen.

Exactly, your dollars maybe accepted as a courtesy, but they are not legal tender in Mexico, the same way as Pesos are not legal tender in your country. As Stewbear posted, you will suffer in the rate of exchange and end up paying a lot more for everything.

Also, if you get outside the major tourist centers, small shops may not be able to provide change for any USD bills over $10.

Yes, in heavily-touristed areas, like the Mayan Riviera, Cabo San Lucas, etc. USD are widely-accepted, usually at a premium, so your money won't go as far as it would if you use pesos. But if you are not in a touristy area like that, you will likely have trouble finding places that accept USD.

I've always just gotten pesos from bank ATMs in Mexico and used pesos exclusively. For larger expenses, like hotel rooms, I usually pay in pesos with my credit card.

USD are accepted in some areas visited by a lot of tourists like Riviera Maya. But right now the exchange rate at a bank ATM is about 18.5-18.7 -1 pesos to USD so you would usually lost using USD since merchants can set whatever rate they want. Taxis for example often use 10-1 so you would be paying almost double.
Disagree about using an exchange booth at any airport as they normally give the worst rates, there are normally several bank owned ATMs near Customs area.

Also small shops may not know what a dollar is worth in pesos, plus doubt over if it's real.

You can absolutely use USD in Mexico and the shops know exactly what the rate is. But they use it to their advantage and you will lose in the exchange. No problems other than that though. I never use it but often vendors or shops will quote in us$. This is in the Mayan, Puerto Vallarta, Cabo, maz, tourist areas.

I changed money in PV several times the past few weeks. I just got back last night. There are cambios all over town there.

There is some kind of a cap on how much you can change legally within a month, but I think that would only effect property owners, renters, business owners, not any limit a typical tourist would ever hit.

I have never tried to directly spend USD though because it's a hassle (when everything is priced in peso) it is easier ("better") to just have peso on you.

I order some from my bank in advance, I take USD to exchange, and yes use my regular debit card at a Mexican bank ATM to withdraw peso directly after I am there. Each has its pros/cons.

Suze

That just isn't true, she probably has very limited experience. Yes, it's very easy to exchange in real resort areas, the rates aren't too terribly bad, some a bit better than others, but you maybe lose only up to about 3-5 pct in Playa del Carmen where I did this most recently. That was because I didn't need that much and the main bank ATM near my hotel had a very large fee for foreign card ATM use, actually (Scotiabank, I think it was a flat fee of the equivalent of about US$5). Many stores took USD, but of course, their exchange rate varied and usually wasn't as good as the hole-in-the-wall cambios. They don't do that as a "convenience" for the customers, they do it to make money, they obviously get a lot more sales if they accept USD, and most make money on the exchange, also.

It is true the cambios wanted to see a passport and write the info down, and I don't recall them doing that before. You could find some that didn't, of course, if you cared.

as for Mexico City, it's a little different in a major city like that and I don't recall trying to do that there (I used credit cards and ATMs). YOu don't have cambios every block or so like you do in some big resort areas. But even there, you'll have cambios inside the major hotels, of course. I did use an ATM at the airport.

Here is one chain for example that it at the airport and in several of the major hotels
https://www.globocambio.com.mx/en/br...co/mexico-city

I don't know why anyone would want to use USD as their main source of funds when traveling, though, Mexico or anywhere. Now I agree it would be hard to find stores to accept USD as currency other than resort areas, but I don't agree that it is impossible to exchange USD at cambios, or in banks or in major hotels.

I think this might be what is being referred to:

"Exchanging Dollars for Pesos. According to the new regulations, casas de cambio (currency exchange booths), banks and hotels may exchange a maximum of $1500 USD in cash per person per month into Mexican pesos. Many financial institutions are limiting this to exchange up to $300 USD in a single transaction.May 7, 2017
Exchanging US Dollars for Pesos in Mexico"

gomexico.about.com/od/money-matters/qt/exchanging-dollars-in-mexico.htm