A fair rule about torn banknotes is that if you have more than half of the note, then it’s valid, but less than half isn’t. In Mexico, merchants of all kinds tend to reject banknotes that have any part missing, and many will refuse to receive bills that are torn in any way, taped together, or even scribbled on.
That doesn’t mean that damaged notes become worthless. The central bank will take them back and replace them, and any retail bank will exchange them.
But for one reason or another —possibly a history of doing hand-to-hand combat with the bureaucracy— people in Mexico would rather avoid having to go through any of that.
As a result, a damaged banknote becomes like the joker in the card game where the object is to avoid taking the joker from another player, and if you do get it, surreptitiously hand it off to another. The loser is the one who’s left with the joker when all the pairs have been removed from play.
There are a number of tricks for this when the joker is a banknote. One is to fold the torn corner over and hand in the note —nonchalantly, of course— with the good side up. This doesn’t work at supermarkets where cashiers will often hold bills up to the light to check for watermarks.
Another way is to pack it in with several bills, all handed in together, but this only works for relatively large purchases or small bills. Another is to use the torn note to pay for something you have already consumed —food, or a taxi ride— arguing that it’s all the money you have.
And all this to avoid dealing with the bank.
The fussiest of all in receiving bills in poor condition are the cashiers staffing the top-up kiosks Mexico City’s Metro. They will refuse banknotes even if they just look a bit shabby. No one has more change than the Metro ticket office cashiers, and yet they will often either refuse large bills, or pay out the change in the most deliberately annoying combination of small coins, sliding them into the gully under the window where they are difficult to collect, particularly if there’s an impatient line of people behind you. So if you’re playing joker with a torn banknote, don’t even think about the Metro.
How to exchange damaged Mexican bank notes
If you have a torn or damaged note you can visit any retail bank in Mexico who will exchange the note(s) provided you have at least half of the note intact and that the bill passes the bank’s security checks to ensure it’s not counterfeit. There is a $3,000 peso exchange limit at retail banks, and you don’t have to be a customer of the bank to avail yourself of the service.
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Best place I’ve found to “pass off” a “joker” banknote is at a busy Pemex .