💰 Quick Context: Euros, Multibanco and an Island Inside the EU
Madeira uses the euro and the same Multibanco cash machines as mainland Portugal. Unlike the Canary Islands it sits inside the EU VAT area, with a standard rate of 22 percent against 23 on the mainland, so there is no duty-free shopping. Funchal is card-friendly. Budget for two newer charges, a per-night tourist tax and a fee to walk the classified trails, and ask the price per kilo at the market's fruit stalls before anything is cut.
🎧 Order Euros Before You Fly
Madeira's airport diverts flights in high winds. Land ready. Insured delivery, 2–5 days.
Order EUR → CEI Currency ExchangeIs Madeira Cheaper Than Mainland Portugal? The VAT Question
Madeira is not the Canary Islands. Travellers who have been to Tenerife sometimes arrive expecting an island outside the EU tax system with cheap shopping. Madeira is an autonomous region of Portugal inside the EU and inside the EU VAT area. There is no special island tax replacing VAT, no duty-free shopping on the island, and nothing unusual about bringing purchases home to another EU country.
What Madeira does have is slightly lower rates. Portugal lets its autonomous regions set VAT a little below the mainland, and Madeira does: the standard rate is 22 percent, against 23 percent on the mainland, with correspondingly lower intermediate and reduced rates on food and restaurant bills. The difference is real and small, about a percentage point, and it is already included in every price you see. It is not a reason to shop here.
Visitors from outside the EU can still reclaim it. The usual tax-free shopping rules apply: buy from a participating shop, spend over the minimum, ask for the form, and have it validated when you leave the EU. Madeira embroidery, wine and wicker are the goods most often bought here.
Where Madeira is cheaper is everyday life. Outside the hotel zone, a prato do dia, a coffee at the counter or a glass of poncha costs noticeably less than in Lisbon, because local wages are lower. Hotels in Funchal are priced for an international market and are not.
Tourist Tax and Trail Fees: The Island's Newer Charges
A per-night tourist tax. Funchal and several other Madeiran municipalities charge visitors a municipal tourist tax of a couple of euros per person per night, capped at a set number of nights and waived for young children. It is collected by the hotel or holiday rental, often at check-out and sometimes separately from a room booked and prepaid through a platform. It is legitimate; ask for it on the receipt.
A fee for the famous walks. Madeira's mountain paths and levada walks draw huge numbers of hikers, and the regional government now charges non-residents a small fee to use the island's classified walking trails. It is paid online in advance, and checks are made at the busiest trailheads, such as Pico do Arieiro to Pico Ruivo and the popular levadas. Residents are exempt. Buy it before you set off, because many trailheads have no signal and nowhere to pay.
Parking at the viewpoints. The most popular sunrise and trailhead car parks fill before dawn in summer, and some are managed and charged. On busy days the cheapest option is a tour or taxi that drops you at the start of a linear walk and collects you at the end, which also solves the problem of getting back to your car.
The Fruit-Tasting Trap at the Mercado dos Lavradores
The market is worth visiting. Funchal's Mercado dos Lavradores, in a 1940s building by the old town, is the island's showcase for flowers, fish and tropical fruit, including passion fruit varieties, custard apples and the local anona.
The tasting is the sales technique. On the fruit floor, stallholders offer visitors slices to taste, keep cutting, and then weigh up a bag of the fruits you tried at a per-kilo price far above the rest of the market, or the rest of the island. Visitors regularly walk away having paid many times the going rate for a bag of fruit, because by the time the price is named it feels rude to refuse.
How to shop there. Ask the price per kilo before anything is cut or weighed, decline tastings you do not intend to pay for, and compare with the stalls on the ground floor and at supermarkets, where the same fruit sells for a fraction. Most stalls take cash; paying by card makes it easier to see exactly what you were charged.
Cash vs. Card in Madeira
Funchal is as card-friendly as the mainland. Hotels, restaurants in the old town and the Lido area, supermarkets, the cable cars, car hire desks and most shops take Visa and Mastercard contactless. American Express is less common. Multibanco, Portugal's shared bank network, runs the island's cash machines exactly as on the mainland.
Cash matters in specific places. The poncha bars in Funchal's Zona Velha and in villages such as Serra de Água, the wicker toboggan ride down from Monte, the market stalls, some levada-side cafes and mountain snack bars, small village restaurants, and tips. Island taxis increasingly take cards, but not all.
How much to carry. €40 to €80 in small notes covers a few days of poncha, market purchases, a toboggan ride and the cafe at the end of a levada. Take out more before a day in the north or west of the island, where machines thin out between villages.
How to Get Euros for Your Madeira Trip
Madeira uses the euro and the same Multibanco network as the rest of Portugal, so the cheapest route is straightforward. The one planning point is taking cash out in Funchal or Machico before heading into the mountains.
Order euros before you travel
US travellers can have CEI Currency Exchange ship euros to a US address with insured 2 to 5 day delivery. Madeira's airport is famous for strong crosswinds that divert flights to Porto Santo, Lisbon or even the Canaries, and landing somewhere unplanned with cash in hand makes a disrupted evening easier. Order small notes for poncha bars and taxis.
Withdraw from a Multibanco machine
Machines carrying the Multibanco mark give the network rate and charge nothing at the machine, as explained in the Portugal money guide. In Madeira they are concentrated in Funchal, Machico, Santa Cruz near the airport, Câmara de Lobos and Ribeira Brava. The north coast villages and the Paul da Serra plateau have far fewer. Our ATM fee calculator shows what your card adds.
Independent machines in the hotel zone, and exchange counters
Standalone machines along the Estrada Monumental and in the Lido hotel area are not part of Multibanco. They add a charge and offer to convert your withdrawal into your home currency. Exchange counters in the airport and the hotel zone price their convenience into the rate. Walk to a bank branch machine and choose euros.
For a side-by-side comparison of every method, see our complete Getting Currency guide →.
Best ATMs to Use in Madeira
Every Portuguese bank's machines belong to Multibanco, so any branch machine is a good choice. Portugal has no Bank of America Global ATM Alliance partner, and neither does Madeira, so a BoA card pays its normal non-network fees at every machine.
Caixa Geral de Depósitos (CGD)
Portugal's state-owned bank and the widest network on the island, with branches on Avenida Arriaga near the cathedral, at the shopping centres and in the main towns. The safest default if you are heading out of Funchal.
Top Pick
Millennium BCP
Portugal's largest private bank, well represented in Funchal and the larger towns. Multibanco rate, no machine fee, and plenty of machines in the old town and the commercial centre.
Recommended
Novo Banco
A major national bank with branches in Funchal and the south coast towns. Works exactly like every other Multibanco machine for a foreign card.
Recommended
Santander
Santander's Portuguese operation has branches in Funchal. Useful if you bank with Santander elsewhere, and a normal Multibanco machine if you do not.
Recommended⚠️ Choose Euros on Every Screen
Hotel-zone machines and some restaurant terminals offer to charge a foreign card in dollars or pounds. Accepting hands the exchange rate to the provider at a markup far larger than any fee on this page. Choose euros every time. Our dynamic currency conversion explainer shows how the numbers work.
Machines and Counters to Avoid in Madeira
The risks here are the same small set found wherever Portugal's resorts attract independent operators, plus one that is specific to Funchal's market.
Independent Machines in the Lido Hotel Zone
Standalone machines along the Estrada Monumental and outside minimarkets near the big hotels. No Multibanco mark, a withdrawal surcharge, and an offer to convert into your home currency. The test is simple: if the machine does not carry the Multibanco logo, walk to one that does.
AvoidThe Tasting Stalls at the Mercado dos Lavradores
Covered above. Free slices, then a bag of fruit weighed at a price many times what the same fruit costs downstairs. Ask the price per kilo first, every time.
Ask FirstCable Cars, the Toboggan, Buses and Driving
Monte and the wicker toboggan. The cable car from the Funchal seafront up to Monte takes cards at the ticket office. The famous carros de cesto, wicker sledges steered downhill by two men in straw hats, are priced per sledge rather than per person, so sharing brings the cost down, and the drivers expect a tip at the bottom. Payment has traditionally been in cash.
Buses. Funchal's orange city buses and the regional companies' coaches reach almost every village. Buy tickets on board or use a rechargeable card sold in Funchal; carry small change for the driver. The airport bus into Funchal is cheap compared with a taxi and takes cards on some services.
Taxis and tours. Taxis are plentiful in Funchal, metered in town and quoted by destination for trips around the island. Many drivers offer half-day and full-day tours at set prices; agree the total and whether it includes waiting time before you set off.
Driving. Madeira's expressways are toll-free, a relief after the mainland's electronic toll gantries, but the mountain roads are steep, narrow and slow. Hire-car deposits are held on a credit card, and fuel stations are sparse in the interior. Parking in central Funchal is metered and paid by machine or app.
Porto Santo. The neighbouring island, with its long sandy beach, is reached by a daily ferry from Funchal or a short flight. Book by card in advance in summer; the ferry is often cheaper booked together with a hotel.
Tipping in Madeira
Portuguese norms. The Portugal guide covers them in full. Bills carry no service charge and card terminals rarely offer a tip line, so tips are left in coins. Rounding up or 5 to 10 percent for good table service is generous. Watch for the couvert, the bread, butter and olives placed on the table before you order, which is charged if you eat it.
Madeira's extras. Tip the toboggan drivers a few euros at the bottom of the run, the levada and mountain guides after a good day, and taxi drivers on a full island tour. Poncha bars and cafes expect nothing beyond the change.
Frequently Asked Questions
Is Madeira duty-free like the Canary Islands?
No. Madeira is an autonomous region of Portugal inside the EU and the EU VAT area, so there is no duty-free shopping and no special island tax. VAT rates are slightly lower than on the mainland, with a standard rate of 22 percent against 23, and the difference is already in every price.
Does Madeira charge a tourist tax?
Yes. Funchal and several other municipalities charge a tourist tax of a couple of euros per person per night, capped at a set number of nights and waived for young children. It is collected by your hotel or rental, often at check-out even if the room was prepaid through a booking site.
Do I have to pay to walk the levadas in Madeira?
On the classified trails, yes, if you are not a resident. Madeira's regional government charges non-residents a small fee to use its official walking routes, including the Pico do Arieiro to Pico Ruivo path and popular levadas. Pay online before you go, because trailheads often have no signal, and checks are made at the busiest ones.
How do I avoid being overcharged at the Funchal market?
Ask the price per kilo before any fruit is cut, weighed or bagged, and decline tastings you do not intend to pay for. The tasting stalls on the fruit floor of the Mercado dos Lavradores are known for weighing up bags at prices far above the rest of the market. Compare with the ground-floor stalls and supermarkets.
Does Bank of America have an ATM partner in Madeira?
No. Portugal has no Bank of America Global ATM Alliance partner, and neither does Madeira, so a BoA debit card pays its normal non-network fees. Multibanco machines charge nothing at the machine themselves, so a card with no foreign transaction fee withdraws at the network rate.
Do I need cash in Madeira?
A little. Funchal's hotels, restaurants, supermarkets and cable cars take cards. Carry 40 to 80 euros in small notes for poncha bars, market stalls, the Monte toboggan ride, mountain cafes, some taxis and tips, and withdraw in Funchal or another south-coast town before driving into the interior or the north.
What happens if my flight to Madeira is diverted?
Strong crosswinds at Madeira's airport regularly delay or divert flights, most often to Porto Santo, Lisbon or occasionally the Canary Islands. Airlines arrange onward travel, and under EU rules owe care such as meals and a hotel during long delays even when weather means no compensation. Keep some euros and your card handy, and check what your travel insurance covers.
Go deeper: Madeira and Portugal
This page covers the island. For the national picture, including how Multibanco works and Portugal's tipping norms, start with the Portugal guide. For the mainland's holiday coast and its barrier-free motorway tolls, Faro. For the Atlantic islands that really do sit outside the EU VAT area, the Canaries.
Hero photo: the harbour at Funchal, Madeira, by Dietmar Rabich, CC BY-SA 4.0, via Wikimedia Commons.