Specifics of banking in Mexico

The Mexican banking industry is one of the most developed in Latin America. Strict capital controls and relatively low interest rates contribute to its strong performance. The influx of foreign investment has further helped the stability of the Mexican banking system.

Banking System of Mexico

Mexican banks are well capitalized and have strong capital buffers due to conservative regulatory measures adopted by Mexican regulators. In terms of assets, the Mexican banking sector is the second largest in Latin America. Mexico's banking industry is highly concentrated, with the 7 largest banks (known as the "G-7") holding approximately 80% of total assets. The largest banks are mostly subsidiaries of large international banking groups. There are about 50 commercial banks and several government-owned development banks in Mexico.

The Secretariat of Finance and Public Credit (Secretaría de Hacienda y Crédito Público or SHCP), the National Banking and Securities Commission (Comisión Nacional Bancaria y de Valores or CNBV), and BANXICO (the Central Bank) are the main regulators of the banking system.

The SHCP handles institutional issues such as licensing and sets credit and fiscal policies.

The CNBV, a semi-autonomous government agency, is responsible for supervision and compliance. BANXICO implements these policies and operates the interbank clearing and check compensation systems.

The Institute for the Protection of Bank Savings (Instituto para la Protección al Ahorro Bancario  or IPAB, replacing the former FOBAPROA) acts as the deposit insurance institution.

The Mexican Banking Association (Asociación Bancaria Mexicana or ABM) represents the interests of Mexican banks.

Largest Banks

• BBVA México

BBVA México is one of the country's largest financial institutions, part of the BBVA Group, based in Spain. It offers a wide range of services, including personal banking, corporate, investment banking and wealth management.

BBVA México serves millions of customers with over 1,700 branches and 7,000 ATMs. The bank is well known for its innovative digital banking solutions, including mobile apps that facilitate seamless transactions and account management.

• Citibanamex

Citibanamex, a subsidiary of Citigroup, is one of the oldest banks in Mexico, with a history dating back to 1884. It offers a wide range of services, including retail banking, corporate banking and investment services.

Citibanamex boasts an extensive network of over 1,500 branches and 9,000 ATMs throughout the country. The bank is known for its strong customer service and various financial products designed for different segments, including personal loans, mortgages and investment options.

• Santander México

Santander México is part of the international Santander Group, which has a strong presence in Latin America. The bank provides a wide range of services, including retail banking, corporate banking and insurance.

With 1,200 branches and a robust digital platform, Santander México focuses on customer convenience. The bank offers competitive interest rates on savings accounts and a variety of credit options, serving both individuals and businesses.

• Banorte

Banorte — one of the largest financial institutions in Mexico, specializing in providing services to individuals, businesses and government organizations. The bank offers personal banking, corporate banking and investment services.

Banorte is known for its strong local presence, with more than 1,200 branches and 8,000 ATMs. The bank places special emphasis on customer service and offers personalized banking solutions.

• HSBC México

HSBC México is a subsidiary of global banking giant HSBC Holdings. It offers a wide range of services, including retail banking, corporate banking and wealth management.

With a network of more than 1,000 branches and 5,000 ATMs, HSBC México is known for its superior global connectivity. The bank provides a variety of international banking solutions, making it an excellent choice for expatriates and international companies.

• Scotiabank México

Scotiabank México is a subsidiary of the Canadian bank Scotiabank, which has a strong position in the Latin American market. The bank provides a range of personal and commercial banking services.

Scotiabank has over 1,000 branches and 5,000 ATMs throughout Mexico. The bank is known for its competitive credit card offerings and a variety of loan products that meet both personal and business needs.

• Inbursa

Inbursa is a financial institution owned by Grupo Carso, headed by Mexican billionaire Carlos Slim. The bank offers a wide range of services, including personal banking, investment banking, and insurance products.

Inbursa's focus on customer service and innovative financial products has helped it grow significantly in recent years. The bank's offerings include savings accounts, personal loans, and investment funds, making it a one-stop choice for customers.

• Banamex (part of Citigroup)

Banamex, part of Citigroup, provides a wide range of banking services, including commercial banking, investment banking, and asset management.

With a strong focus on technology, Banamex offers innovative digital banking solutions that allow customers to conveniently manage their finances. The bank is also known for its competitive mortgage products and personal loans.

• Banjército

Banjército is a unique bank that primarily serves members of the Mexican military and their families. It provides a variety of banking products, including savings accounts, loans, and insurance.

The bank operates numerous branches in military installations and civilian areas.

• Banco del Bajío

Banco del Bajío is a regional bank that focuses on providing financial services in central Mexico. It offers personal banking, corporate banking, and agricultural financing.

Banco del Bajío has a strong regional presence and operates more than 300 branches. The bank is known for its commitment to supporting local businesses and agriculture by providing customized financial solutions for these sectors.

Mexican Payment System (SPEI)

One of the goals of the Central Bank is to promote the development of the Mexican payment system. The Central Bank oversees the Interbank Electronic Payments System (Sistema de Pagos Electrónicos Interbancarios or SPEI) for both large and small payment transactions, and regulates retail payment systems that include electronic funds transfers, card payments, direct debits, and cheques.

SPEI is an electronic funds transfer system owned and operated by the Central Bank. The system has allowed participants to transfer money in real time since August 2004. The system is used for both large payments and small transactions. SPEI is It is a hybrid system that processes transactions every few seconds and the results are immediately credited to the participants' cash accounts.

Digital Payment System (Cobro Digital or CoDi)

In January 2019, the Central Bank, the Secretariat of Finance, and the Mexican Banking and Securities Commission announced a new payment system using a QR (Quick Response) code. The system, called Cobro Digital or CoDi, is part of the government's efforts to increase financial inclusion and reduce the cash economy.

CoDi users/customers must have a smartphone and a level 2 bank account (accounts that can be opened with basic customer information). Merchants must have a static QR code, a smartphone to download the CoDi app (for in-person transactions), or a web page to create CoDi requests for online sales. The CoDi system was officially launched in March 2019 during the Annual Convention of the Mexican Banking Association.

Mexico's Financial Technology (Fintech) Law

With over 400 fintech startups, Mexico is currently the second largest fintech market in Latin America after Brazil. Most Mexican fintech companies focus on payments and remittances, personal finance management, crowdfunding, and lending.

In addition to these fintech segments, the Mexican market is active in personal finance management, financial education and savings, and scoring solutions.

Due to the growing importance of the fintech industry in Mexico, in 2017 and 2018, financial regulators drafted Mexico’s first FinTech Regulatory Law to reduce operational risk, increase transparency, and improve security. On March 10, 2018, the FinTech Law was published in the Official Gazette.

The law covers four main areas of fintech services. These include crowdfunding and P2P lending, e-money services, virtual assets and application programming interfaces (APIs). The law was designed to promote financial inclusion, consumer protection, financial stability, competition and financial integrity.

The law allows companies and financial institutions to obtain special temporary permission to offer financial services using technological tools through the regulatory framework. The Fintech Law also mentions the establishment of a Financial Innovation Group formed by financial authorities and the private sector to exchange ideas, discuss innovations in the financial sector between the private and public sectors and achieve better planning and drafting of the law. The law also establishes that SHCP, CNBV and BANXICO are the main regulators for the fintech sector.

The Fintech Law includes the possibility of obtaining a special temporary authorization to offer financial services using technological tools, subject to certain conditions.

Development Banks

The mission of development banks is to fill the financing gap in the commercial banking sector. Mexico has seven public development banks that provide services to specific areas of the economy. The dominant institutions are Nacional Financiera (Nafinsa) and Bancomext (Banco Nacional de Comercio Exterior or National Bank for International Trade). These institutions have become primarily second-tier banks that issue loans through commercial banks and other financial intermediaries such as credit unions, savings and loan companies, and leasing and factoring companies.

Nafinsa's main program finances SMEs and microenterprises. Nafinsa also makes strategic equity investments and contributes capital to joint ventures.

Bancomext provides financing to Mexican exports and SMEs. It also offers working capital, project lending, and training to firms in a few specific sectors that need support, such as the textile and footwear industries.

Other Mexican development banks include Banobras (Banco Nacional de Obras y Servicios Públicos, or National Development Bank for Public Works and Services), Financiera Rural (Financiera Nacional de Desarrollo Agropecuario, Rural, Forestal y Pesquero, or Rural Agricultural Bank), Bansefi (Banco del Ahorro Nacional y Servicios Financieros, or National Savings and Financial Services Bank), Banjercito (Banco Nacional del Ejército, or Bank of the Mexican Army, Air Force, and Navy), and Hipotecaria Federal (which finances Mexican homeownership through financial intermediaries).

Non-bank institutions (SOFOM)

The non-traditional banking sector in Mexico consists of bureaux de change, credit unions, leasing, factoring companies, and financial credit networks with the authority to manage multiple lines of business for the provision of credit (known by the acronym SOFOMs, after their legal corporate structure called Sociedad Financiera de Objeto Múltiple ).

SOFOMs are divided into two categories: Entidades Reguladas, or regulated entities (SOFOM ER) and Entidades No Reguladas, or non-regulated entities (SOFOM NR).

With the financial reform, regulation and supervision of SOFOMs has increased. SOFOMs are required to maintain up-to-date information with the National Commission for the Protection of Users of Financial Services (CONDUSEF) and they are required to provide information about their borrowers to at least one credit bureau.

SOFOMs may offer financial factoring, leasing, loans and/or other credit services, but they are not allowed to accept deposits from the public.

Online Banks in Mexico

N26 is an innovative online bank operating in Mexico that offers digital banking services through a user-friendly mobile app. It offers features like online payments, savings accounts, and budgeting tools, making it a popular choice among tech-savvy customers looking for a convenient and efficient banking experience.

Revolut, another online banking option in Mexico, is known for its innovative features, including multi-currency accounts, free international transfers, and cryptocurrency trading.

Hey Banco by Banregio Bank is an easy-to-set-up app. Within 5-10 days, you will be sent a Visa debit card that can be used anywhere Visa is accepted.

Types of Bank Accounts

• Savings Account (Cuenta de ahorro)

Ideal for short-term savings purposes, offering reasonable interest rates and easy access to funds.

• Current Account (Cuenta de cheques)

A versatile account for everyday transactions, offering checkbooks and debit cards for easy access.

• Business Account (Cuenta enterprise)

Designed specifically for businesses providing services such as lending, merchant services and payroll management.

• Foreign Currency Account (Cuenta en moneda extranjera)

Facilitates international transactions by allowing you to hold funds in different currencies, avoiding fees for conversion.

• Salary Account (Cuenta de nomina)

Designed for employees, it offers direct salary deposit and additional benefits such as discounts and rewards.

• Investment Account (Cuenta de inversión)

For individuals looking to invest, options such as mutual funds, stocks and bonds are available to increase their wealth.

• Retirement Account (Cuenta de jubilados)

Dedicated to retirees, it provides a secure platform to manage their pension funds and receive their retirement benefits.

• Youth Account (Cuenta para jóvenes)

Designed for young people, offers educational features and lower fees to encourage financial literacy.

• Joint Account (Cuenta Solidaria)

Allows multiple people, such as couples or business partners, to share an account and manage their finances.

Documents Required to Open a Mexican Account

Opening a Mexican bank account requires certain documentation to verify identity and address. These documents may vary depending on your status in the country.

For Mexican citizens and residents

• A valid Mexican ID (IFE or INE card);
• Proof of address (utility bill, lease, or official letter);
• CURP card (Clave Única de Registro de Población).

For foreigners and non-residents

• Photo identification, usually a passport;
• A letter proving residency, such as a utility bill (issued within the last 3 months);
• Proof of legal entry into Mexico (such as a residence permit or visa FMM).

Please note that specific requirements may vary depending on bank policies and individual circumstances. It is recommended that you contact your chosen bank in advance to find out their exact documentation requirements, as these requirements may vary depending on your residency status and personal situation.

Tips to Simplify the Account Opening Process

To ensure a smooth process for opening a bank account in Mexico, consider the following tips:

• Be mindful of the language. While many bank staff speak English, knowing some basic Spanish phrases can be helpful during the application process. You can even bring a local friend along to help you overcome the language barrier.
• Make an appointment. Many banks prefer to schedule appointments for account openings. Schedule an appointment in advance to ensure specialized assistance and minimize wait time.
• Visit a local branch. If possible, visit a local branch of your chosen bank. In-person visits allow you to clarify doubts, provide documents, and receive immediate assistance.
• Understand the fees. Learn about the fees associated with your chosen account, including monthly fees, transaction fees, and ATM withdrawal fees. Choose an account with reasonable and transparent fees.
• Ask questions. Don’t hesitate to ask about account features, transaction limits, and online banking services. Clear communication ensures that you choose the right account.
• Double-check the application form. When filling out the application form, check the details carefully to avoid errors. Being precise during the application process can prevent delays.
• Be patient and persistent. Opening a bank account can take time, especially if there are special documentation requirements. Be patient, clarify details as needed, and continue until the process is complete.