Banking

Mexican Gov’t. Wants Bank Competition To Help Unbanked

Mexican Gov’t. Wants More Bank Competition

The Mexican government wants local banks to do more to help the millions of unbanked citizens in the country.

President Andres Manuel Lopez Obrador, as well as the head of the country’s banking association, Luis Nino de Rivera, called on the country’s banks to offer lower commissions to help the more than half of the population that do not have bank accounts, according to Reuters.

The government might even grant more licenses to create new banks and boost competition, President Obrador said at a banking convention in Acapulco. He added that the country won’t set any new legislation that would regulate bank commissions.

His promise comes after the ruling MORENA party introduced a bill last year to limit banking fees, which caused a selloff in the stock market. As a result, Obrador said there would be no legal changes on economic, financial or fiscal matters in the first half of his term.

Just last month, the Mexican government announced it is set to launch a digital payments system that will be operated by the central bank, enabling citizens to make and receive payments via a smartphone without any fees. The payment system, called CoDi, is slated to debut this month. To use the mobile app, consumers must have an account with an institution that is participating in Mexico’s existing interbank payments systems, which will power the payments platform. Jaime Cortina, director of operations and payments at the central bank in Mexico, explained the goal is to create a payment method that citizens can use to send money to one another and to make payments at stores and online.

“In the future, it will no longer be necessary to have a bank in the sense of a traditional, established bank,” Arturo Herrera, Mexico’s deputy finance minister, said at the time. “Mobile phones will become banks.”

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