What Currency is Used in Madeira?

What currency is used in Madeira?

If you’re planning a holiday to Madeira, investing in property, or working with businesses on the island, understanding its currency is essential. This article is designed for travellers, expats, and professionals seeking clear, up-to-date information on money in Madeira. We’ll cover the official currency, how it works, and offer practical advice for handling your finances efficiently while avoiding unnecessary fees.

Madeira’s official currency: the Euro

Madeira uses the Euro (EUR) as its official currency. The euro is symbolised as € and is divided into 100 cents. You’ll find coins in denominations of 1, 2, 5, 10, 20, and 50 cents, as well as €1 and €2 coins. Banknotes are available in €5, €10, €20, €50, €100, €200 and €500, though larger notes are rarely used in everyday transactions.

This may surprise some visitors, especially those unfamiliar with Madeira’s political status. Although geographically located off the northwest coast of Africa, Madeira is an autonomous region of Portugal—and therefore a part of the European Union and the Eurozone.

Who needs to use the Euro in Madeira?

The euro is used across Madeira for all types of transactions, including accommodation, car hire, restaurant bills, and local transport. Whether you’re staying in Funchal, exploring remote villages like Santana, or visiting coastal towns like Calheta, you’ll need euros for day-to-day purchases.

Visitors from outside the Eurozone—including travellers from the UK, the US, or Canada—must exchange their home currency for euros before or during their trip. Businesses in Madeira do not typically accept foreign currency, and using anything other than euros may lead to confusion or rejection.

How the Euro functions in Madeira

Because Madeira is fully integrated into Portugal’s economy, there’s no local variation of the euro. All notes and coins are identical to those used in mainland Europe. The euro in Madeira is regulated by the European Central Bank (ECB) and follows the same monetary policy as the rest of the Eurozone.

Exchange rates for travellers are determined by the global market and can fluctuate daily. If you’re exchanging currency or using a card from a non-euro country, the rate you receive will depend on the provider and any fees involved.

Benefits and drawbacks of using the euro in Madeira

Advantages:

• No currency conversion needed for travellers from the Eurozone.

• Stable and widely accepted—you can use the same currency across much of Europe.

• Secure and trusted—regulated by the ECB and supported by a strong financial framework.

Considerations:

• Exchange fees may apply for non-euro visitors, especially at airports or tourist exchange desks.

• Cash reliance is still common in smaller villages or local markets.

• Dynamic currency conversion on card machines can result in poor exchange rates if you choose to pay in your home currency instead of euros.

Money management tips for Madeira

• Use ATMs linked to Portuguese banks like Millennium BCP, Novo Banco, or Santander Totta to get competitive exchange rates.

• Avoid exchanging large sums at the airport, where the rates are often less favourable.

• Carry some cash—especially useful in rural areas, for tipping, and at smaller businesses that may not accept cards.

• Use a travel-friendly debit or credit card with no foreign transaction fees to minimise costs.

• Decline “pay in your currency” options on card machines and always choose to be charged in euros for a better exchange rate.

Common questions

Can I use British Pounds or US Dollars in Madeira?
No. Only euros are accepted in shops, restaurants, and transport. You’ll need to exchange your currency or use a card that supports euro payments.

Is Madeira expensive compared to mainland Europe?
Madeira is generally affordable, especially when compared to popular Western European cities. Meals, public transport, and groceries are reasonably priced.

Are contactless payments widely accepted?
Yes. Most businesses, especially in Funchal and larger towns, accept contactless and chip-and-PIN cards. Smaller establishments may prefer cash.

Do I need to tip in Madeira?
Tipping is not compulsory but is appreciated. Rounding up or leaving 5–10% is customary for good service in restaurants.

Real-life example

A couple from the UK travels to Madeira with £500 and plans to stay for a week. They exchange a small amount before departure for immediate expenses, then use a travel debit card with no fees to withdraw euros locally. They spend euros at restaurants, supermarkets, and taxis, using cards where accepted and cash for smaller purchases. By avoiding airport exchange desks and always opting to pay in euros, they reduce unnecessary costs and stay within budget.