CUC vs CUP vs MLC: Cuba's Confusing Currency System Explained

If you haven't visited Cuba in a few years, or if you are newly trying to help family on the island, Cuba's currency system can seem like an unsolvable puzzle. The island has gone through drastic economic changes, retiring old currencies and inventing new ones, resulting in massive confusion for anyone trying to send money.

To make sure your remittance actually helps your family, you need to understand the three acronyms that define the Cuban economy: CUC, CUP, and MLC.

The Dead Currency: CUC (Cuban Convertible Peso)

Let's start with the easiest one. The CUC is dead.

For over two decades, Cuba operated on a dual-currency system. The CUC (peso convertible) was pegged 1:1 with the US Dollar and was used by tourists and for imported goods. The CUP (national peso) was used by locals for basic rations and state salaries.

On January 1, 2021, the Cuban government enacted the "Tarea Ordenamiento" (Ordering Task) and officially phased out the CUC. It no longer exists in circulation. If an agency claims they will deliver "CUC" to your family, it is a scam or incredibly outdated information.

The Local Currency: CUP (Cuban Peso / Moneda Nacional)

The CUP is now the only official physical currency circulating in Cuba. It is what state workers are paid in, and what people use to buy vegetables at the agro-mercado, pay for the bus, or pay electricity bills.

However, the CUP is suffering from severe inflation. The Cuban government sets an "official" exchange rate (e.g., 1 USD = 120 CUP). But on the street, in the informal market, 1 USD might trade for 300, 350, or even 400 CUP.

Remittance Tip: Never send USD through official channels to be deposited as CUP in a Cuban bank. The bank will use the terrible state exchange rate, effectively stealing more than half of your money's true purchasing power.

The Digital Currency: MLC (Moneda Libremente Convertible)

Because the Cuban government desperately needed foreign currency, they created the MLC. MLC is not physical cash; you cannot hold an MLC bill. It only exists electronically on debit cards issued by Cuban banks (BANDEC, Banco Metropolitano, BPA).

MLC is artificially pegged 1:1 to foreign currencies (like the USD or EUR).

Why does MLC matter?

The government created special stores—Tiendas MLC—that sell essential goods like cooking oil, chicken, shampoo, refrigerators, and air conditioners. You cannot buy these items with CUP; you can only buy them by swiping an MLC card.

Therefore, Cubans constantly need their family abroad to recharge their MLC cards so they can buy basic necessities that aren't available in CUP stores.

The Real King: Physical USD and EUR (Divisa)

Because of the restrictions of MLC (it's trapped in a bank) and the weakness of the CUP, physical foreign cash—called divisa—is the most prized possession in Cuba.

If you send physical US Dollars or Euros via a cash delivery agency to your family, they have the ultimate flexibility. They can:

• Exchange a $100 bill on the informal market for a massive amount of CUP to live on for months.
• Deposit some of it into their MLC card at the bank if they need to buy an appliance.
• Use it to buy goods directly from private businesses (MIPYMES) which often offer better prices for cash divisa.

Summary for Senders

When sending money, you are essentially choosing between sending to an MLC Card (fast, good for state stores) or sending Cash USD/EUR (slower, but best for the informal market).

Ready to send? Use our Cuba Remittance Calculator to compare rates for both MLC deposits and cash delivery to ensure your family gets the most out of every dollar.