Financial Inclusion Report

June 2010

JUNE 2010

National Banking and Securities Commission President Guillermo Babatz Torres

Vice-presidency of Regulatory Policies General Direction on Access to Financial Services Carlos Serrano Herrera, Raúl Hernández Coss, Alejandro Vázquez Zavala, Luis Treviño Garza, Laura Karina Ramos Torres, Ana Belén Rodríguez Quintana, Fernando Licona Herrera, Ana Laura Medina Pérez.

Creativity and Design Natalia López Díaz, Noemí Tecanhuey Sánchez, Bernabé Zamora García, Ricardo Gómez Ortega

Insurgentes Sur 1971, Col. Guadalupe Inn Del. Álvaro Obregón; México, D. F. 0102 México


To Institute for Mexicans Abroad (IME) and to the National Institute on Statistics and Geography (INEGI) for their contributions in the elaboration of different sections of this Financial Inclusion report. Rodrigo Sánchez Arriola Luna. Kate Mcgee. Francisco Zago. To the company Promoción y Operación. to The Consultative Group to Assist the Poor (CGAP) for the comments in the section of consumer protection. To the Alliance for Financial Inclusion (AFI). Viviana Garza Salazar.C (BANSEFI). to the World Council of Credit Unions (WOCCU). PRODESARROLLO and PRONAFIM. Annie Carrillo Soubic. to Mexico’s Central Bank. Gabriela Zapata Alvarez and. to the National Savings and Financial Services Bank. Carlos Cuevas. Leticia Riquelme Arriola. Yerom Castro Fritz. Angélica González Saravia Cos. Carlos López-Moctezuma Jassan. Francisco Mier Sainz Trapaga. María del Carmen Díaz Amador. Financiera Rural. Sirenia Vázquez Báez. S. to the National Commission for the Defense of Financial Institution Users (CONDUSEF). Roberto Sánchez Cuéllar. Jesús David Chávez Ugalde. particulary. Arturo Luna Canales. Arcelia Olea Leyva. S. Celso Garrido. Luis Robles Miaja. Jorge Fabela Viñas. Yoali Ruíz Rocha. to Mexico’s Bankers Association (ABM). Alberto Mendoza Hernández. Ricardo Medina Álvarez. Benjamín Bernal Díaz.N. Patricia Medina Barrera. Francisco Solis Robleda. Carlos Marmolejo Trujillo. (PROSA). Megan Havey. Denise Dias. Elisabeth Rhyne. Jorge Herrera Hernández. for the support in the dissemination of this report through its policymakers network.V. Alfred Hannig. Thorsten Beck. . Daniel Chiquiar Cikurel. This publication would not have been possible without the help of our colleagues: Jorge Alfaro. Ignacio Mas. Alan Elizondo Flores. Brenda Samaniego de la Parra.3 A KNOWLEDGEMENTS The responsible team for developing the report wishes to express its gratitude to the following institutions and people. Mireya Almazán. E-Global. Carlos García de Alba Zepeda. Salvador Bonilla Leal. Rafael Mazer. Finally to the colleagues of the Comimssion involved in reviewing the report and providing comments: Jesús Benítez Martínez.A de C. Lucio López Rincón. the Mexican Association of Internet (AMIPCI). Flavio Torres Nájera. Eduardo Vargas Chavarría. José Santiago Cruz. Diego Britos Chiaramello. Darío Luna Plá. Héctor Rodríguez Larrondo.

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39 CHAPTER 3: ACCESS INDICATORS…………………...123 CHAPTER 6: FINANCIAL INCLUSION BARRIERS…….……. p...57 CHAPTER 4: USAGE INDICATORS…………………………….…..8 INTRODUCTION…………………………………….. p. p..………….140 ... p...83 CHAPTER 5: FINANCIAL EDUCATION AND CONSUMER PROTECTION…………….. p.…………...5 C ONTENTS PRESENTATION ………………………………………..9 CHAPTER 1: CONCEPTUAL FRAMEWORK OF FINANCIAL INCLUSION……………………………………. p.. p.………… p...133 REFERENCES……………………………………………………. p..17 CHAPTER 2: MACROECONOMIC INDICATORS……………..… p.…………….6 METHODOLOGICAL NOTE………………………..

There are several legal figures that allow different institutions to develop business strategies for attending various segments of the population with financial services and specific products.P RESENTATION As in the majority of countries. the Credit Unions and the SOFOLES. it is not the only one that provides financial services to the population. However. in Mexico. Nevertheless. For this reason. including the Cooperatives of Savings and Popular Credit. by using the conceptual framework of indicators about Financial Inclusion presented in the last report. the promotion of greater Financial Inclusion among all the segments of the population requires the sum of all the financial agents. it is the banking sector who distinguishes itself because of the dimension of its participation in the supply of financial services. the SOFIPOS. this one adds to the statistic information of the country´s banking sector which corresponds to Popular Savings and Loans Institutions (PSLI). 6 .

Guillermo Babatz Torres President National Banking and Securities Commission . In this process of innovation in the supply of financial services. for which they require new models of business that allow the interaction of different Financial Institutions regardless of the legal figures they use. the Commission renews its commitment of adequating the regulation to facilitate commercial alliances. the new channels of distribution of financial services of banking agents and mobile banking agents provide a unique opportunity to explore alliances that contribute to the solution of the lack of attention in large areas of our country. Therefore. the CNBV and Mexico’s Bankers Association have been working together to improve the quality of the information regarding Financial Inclusion. A way to develop these new models of business may be by seeking to maximize the potential that commercial networks offer to financial institutions. Likewise. I want to acknowledge the effort of Banco de México and Condusef for providing the information used in the elaboration of this report.7 Both banks and PSLI share the challenge of designing financial products that meet the needs of each segment of the country’s population.

For the geographical information of the municipalities it have been used the databases of the National Institute on Statistics and Geography (INEGI) and the National Institute for the Federalism and the Municipal Development (INAFED). ATMs and financial products was obtained from regulatory reports provided by supervised institutions to the CNBV. The statistics of Internet banking and electronic commerce come from the Mexican Association of Internet (AMIPCI) and the Federal Communications Commission (COFETEL).M ETHODOLOGICAL N OTE The information presented in this report on branches. The data used to make international comparisons come from the Survey of Access to Financial Services. V.1 tool. (PROSA). The information on point of sale terminals comes from Promoción y Operación S. The estimated population comes from the National Population Council (CONAPO). particularly from the regulatory report 24 (R. A. developed by the Edition and Applications of Geographic Information Systems of the National Institute on Statistics and Geography (INEGI). The analysis of family remittances was performed with information of Mexico’s Central Bank and the Institute for Mexicans Abroad (IME). de C. The information on financial education and consumer protection was given by the National Commission for the Defense of Financial Service Users (CONDUSEF). Chapter 7 (Financial Service Access Analysis: Regional Maps) was done using the IRIS 4. The information related with the PSLI was provided to the CNBV by the Cooperative Societies and the Popular Societies.24). conducted by the International Monetary Fund (IMF). 8 . The analysis of Cooperatives is made to those Cooperative Societies with an operating level of I to IV that have obtained authorization from the CNBV. For Chapter 2 (Macroeconomic indicators) the figures were obtained from various sources and could be subject to revisions and further changes.

In the same way it is accepted that. if all actors interacting in the financial sector have better statistical information.9 I NTRODUCTION Policymakers are aware of the importance of basing their actions on statistical evidence from the design and implementation to their monitoring and evaluation. it is possible that these develop business models that address the challenges of the sector. resulting in better products and services for the population. .

focus groups. thus enabling it to improve financial services for the benefit of users of the system. Mexico’s Central Bank and BID Representative sample at a national level and by firm size stratum Demand Coordinated effort between SHCP. 2) include the use of indicators can help identify barriers limiting the development of an inclusive financial system and alert operators of potential business opportunities. Chart A. adapting measurement methodologies and promoting the discussion among the actors of public and private sectors on subjects related to Financial Inclusion. 1 Which include household surveys. BANSEFI Methodological consistency with surveys in other countries Research conducted by INEGI Financial Inclusion Report Statistic studies with Banks about SMBs Financing SHCP. CNBV and the United Nations Economic Council for Latin America (CEPAL) Identify the barriers that prevent granting funding to SMBs Supply Data from the offer obtained from regulatory reports issued by the institutions. companies and focus groups between suppliers and demanders of financial services. to promote transparency in the sector and strengthen decision-making with appropriate information. Initiatives for the measurement of access and usage of financial services Individuals National Survey to Households about Financial Services Usage Measurement of Financial Capacities to improve the quality of products Coordinated effort between CNBV and Condusef with technical assistance from the World Bank. CVBN. This report is part of the projects implemented by the CNBV to improve the information and statistics regarding Financial Inclusion in Mexico1. and 3) provide a better analysis of the financial environment and its participants promotes healthy competition. SEDESOL. CNBV.Objectives of the report This report seeks to be a tool to consolidate information. Its conception comes from three premises: 1) providing more information to financial agents can foster the development of financial products and services. SAGARFA. Information dissemination tools from the Federal Government about the components of Financial Inclusion Two annual Reports and quarterly database update (March and September) Source: CNBV Statistical information and indicators development seek to provide tools for the institutions and users of the Mexican financial system. Focus groups and surveys for each geographic region of the country. 10 . Corporate Entities National Survey to Enterprises about Competitiveness and Access and Usage of Financial Services (ENE) Joint initiative SHCP. Mexico’s Central Bank.

. and they seek to increase their content as they develop new sources of information for developing indicators and adding categories on Financial Inclusion Components. The database. 3 Financial Access 2009: Measuring Access to Financial Services around the world. where reference is made to the bank. which supports the statistics in each report. For purposes of this report where reference is made to PSLI. Chart B. it includes both Commercial Banking and State-owned Banking (See Chart C). CGAP. the Limited Purpose Financial Companies (SOFOLES) and the Credit Unions are included as Microfinance entities.gob. based on the classification used by CGAP3. the State-owned Banking. Financial institutions analyzed The financial intermediaries in Mexico are grouped for their analysis in four as well as what is expected to improve in the subsequent reports. and Microfinance entities. 2 The database of Financial Inclusion is for public use and can be accessed at the website of the CNBV: www. The Popular Financial Companies (SOFIPOs). The first category includes regulated institutions and the Commercial Banking. Release Cycle of Financial Inclusion Report (FIR) March June September December March Database update Database update Report and database update Commercial Banks State-owned Banks Report and database update Popular Savings & Loans Institutions (PSLI) Report and database update Banking Agents Source: CNBV Below it is specified the criteria and other considerations taken into account when preparing the report and the manner to perform the analysis contained therein.cnbv. it refers to both: Cooperatives and Microfinance.11 The reports will be published twice a year. is updated on a quarterly basis as well as the indicators2. the Cooperatives and the Savings and Loans Cooperative Societies.

000 inhabitants.000 inhabitants. Map of regulated financial institutions Commercial Banking State-owned Banking Cooperatives Microfinance Savings and Loans Cooperative Societies Credit Unions Sofipos Sofoles Source: CNBV based on reports made by CGAP Geographical level of analysis The information presented in this report is aggregated at national. 3) Metropolis municipalities: population greater than 1. regional. The total number of municipalities in the country is 2. Urban Municipalities: Urban Municipalities are characterized for integrating a strong economic activity into their territory.000 inhabitants.001 and 1. deposited in highly developed businesses. 12 .Chart C. Chart D. Because there is no strict definition of these concepts. as well as small and medium industries that encourage the development.001 and 15. The report characterizes the municipalities in six categories described in Chart D. fisheries and mining. 1) Rural Municipalities: population between 1 and 5. 2) Semi-metropolis municipalities: population between 300. trade and growth of industry service providers. The infrastructure developed in these is quite broad and they maintain a continuous labor flow.001 and 300.456 (considering the 16 Mexico’s City political delegations as municipalities) and these are profoundly diverse and heterogeneous. the report uses the municipality as a geographical base of analysis. In Mexico the federative entities take as a basis for its territorial division and its political and administrative organization. 3) Semi-urban Municipalities: population between 15. state and municipal level.000. They maintain primary economic activities as agriculture. the Free Municipality4.001 and 50. the CNBV has identified six categories of Municipalities with the purpose of conducting a specific analysis about them (three rural and three urban). 1) Urban municipalities: population between 50.000. Characteristics of the municipalities in Mexico The classification most commonly used for municipalities in Mexico is rural and urban. Source: CNBV 4 Article 115 of Mexico’s Political Constitution. which are better equipped and have a wider range of economic activities.000 inhabitants. Rural Municipalities: Rural Municipalities are characterized by a very small population and high population dispersion.000 inhabitants. However. 2) Transition Municipalities: population between 5.000 inhabitants. They present lack of infrastructure and migration trends to cities and other municipalities. livestock. with the intention of getting better employment opportunities and income.

Denominators for indicators and reference to adults 5 http://www2. However. demographic distribution and infrastructure. Once it possible to have the quality sought at a municipal level we might consider adding the local level. allows crossing information with relative indicators about migration. A locality can be defined as a group whose characteristics are so defined that it distinguishes from others (also known as an inhabited place or settlement). 6 http://www.inafed. apart from maintaining a statistical standard defined by INEGI. towns. work has been done in a coordinated manner to correct location errors arising from homonyms between names of locations and municipalities.asp?idf=956. In this category are the fishing villages. it is now a very complicated request for the information to be based on the local level. it is not possible to use and operate zip codes to place the financial infrastructure at the municipal level because a code can contain more than one municipality or sometimes there are cases where a municipality has more than one zip code.540 km2. regulatory reports only request the information at a state level. The register kept by the banking institutions of the location of POS terminals is based on zip codes in the country.959. cities and other population groups. where residents live in neighborhoods with a series of independent rooms and have a name and status locally recognized5. ranches. . The Mexico’s Bankers Association in coordination with the company PROSA was able to identify the location at the municipal level of most POS terminals. it is important that the municipality is accepted by the various actors as the geographical base of analysis. For the elaboration of statistic information about use and access to financial services. It is striking the fact that even the surface of some municipalities is inconsistent in the database of the Federal Government.13 The Municipalities in turn can be composed by localities.ingei.999. point of sale terminals and ATMs in the record of municipalities elaborated by INEGI. villages. while the surface of the territory according to INEGI is 1. When adding the surface of the registered municipalities in the database of the National Institute for Federalism and Municipal Development (INAFED. For months. There are still records in the same database about municipalities that are considered of recent creation and that don’t have a surface6. There are about Such In the case of point of sale terminals. farms. However.248 km2.gob.000 locations in Mexico according to the criteria of INEGI. mining camps. as the Mexican abbreviation) from the Home Secretary the country has 1. markets. Challenges in the geographic identification of the financial services infrastructure For financial institutions it has been complex to correctly identify the location of their own branches. Given the difficulty in identifying the financial infrastructure in the right place at the municipal level.

the material scope of operation given to them incorporates not only those traditional credit operations they have offered their partners for some time now. The result has been that many organizations have achieved significant improvements in operational. with rates of interest both for those who save and those who ask for a loan. accounts per 1. A denominator larger or smaller than these figures would be more difficult to read and interpret. (10.000 adults in access indicators and 10. made with in order to encourage non-regulated institutions to become part of the financial system under an appropriate regulatory framework so as not to block their growth or specific targets. Apart from the fact that all these intermediaries are obliged to arranged their operations through the authorization of the National Bank and Securities Commission (CNBV). Using these criteria at the moment allows us to maintain consistency with current international efforts to measure Financial Inclusion8. this sector has been growing significantly. or give their warranty or guarantee 7 For example. In Credit Unions. the international standard implemented is the one used in the database "World Development Indicators (WDI)” from the World Bank's 15 years.000 adults in usage indicators)7. Such people are associated with two main objectives: to save and lend to each other money. 8 http://data. in some cases. The new legal framework applicable to Credit Unions allows them to extend credit to their partners. if some members fail to pay.worldbank. The same applies to branches and other distribution channels for financial services. The Savings Account does not have the savings insurance protection such as the IPAB handles. it will affect the preferential rates and even the viability of the account. When someone enters a Savings Account it does so as a partner figure of the same and shares the risk in operations. large organizations with a broad portfolio of partners. effort and mutual aid. 14 .The report contains different denominators in order to obtain figures that are easy to understand for the but the authorized Savings Account should have a private protection fund to guarantee the saver’s money. but also those others that. The Savings Accounts constitute. coming of age begins at 18. While in Mexico. These two financial transactions are made between the partners of the institution. The term adults is used in place of population because of the universe of potential users is limited to people who can legally use financial services and who have financial needs associated with products that satisfy them. We present several modifications to the Law being the one on August 2009 the most recent one. in order to satisfy economic needs of production.000 adults fluctuating between 20 and 4000. fully enabling the participation of private initiative in the activity of savings and popular credit. that is. with the entry into force of the Law on Savings and popular credit. The Popular Financial Societies (SOFIPOS) are institutions that contribute to the existence of various options for people that may have access to savings and credit. are increasingly exploited by businessmen. distribution and consumption of goods and services. Saving entities and popular credit9 Cooperative Societies or Savings Accounts are a form of social organization composed of people with common interests under the principles of solidarity. financial and governance issues. because of various circumstances in the economic and business environment in Mexico. 9 Since 2001.

which serve to support the analysis presented. 10 Banking agents. The section concludes with a brief description of the regulation that has developed in the last month in Mexico to promote greater Financial Inclusion10. the conceptual framework for Financial Inclusion is updated (Section 1). in addition to the Annexes: 7) Access Indicators per Municipalities. indicators of Financial Inclusion barriers (Section 6). which identifies the geography per Municipalities in the five regions of the country according to the National Development Plan. The report is supplemented with eight Annexes. For the first time. and it present a proposal of a conceptual framework to develop. 8) Indicators of use per Municipalities. The first six are presented in this report and the last two are included in the CD-ROM attached. Mobile Phone Banking agents. In the future. the report introduces other categories that support Financial Inclusion. The indicator set is presented in three categories: macroeconomic indicators (Section 2). the conformation of the working group on measurement techniques. They also can manage with them lease or financial factoring operations and buying and selling currencies on behalf of their partners. using the branch access indicators and the use of debit card indicator. these components will have their own indicators.15 for the latter to obtain credit from a third party. and sponsored by AFI and the initiative of the Group of 20 (G-20). Finally. access indicators (Section 3). . and indicators of use (Section 4). in the future. with detailed information per municipality in the country. with information on recent efforts to integrate the definition of it. namely: Financial Education and Consumer Protection (Section 5). in addition to providing information regarding the contents of the database. Below it is shown the list of Annexes printed in this report: 1) Municipalities catalog 2) Infographics per Federative entity 3) Income and credit products per state 4) Historical trends per state 5) Family Remittances 6) International Comparison of Access Indicators The CD-ROM includes an updated database to the month of March 2009. Report Sections In this second delivery of the report. we present an analysis of access to financial services through regional maps (Section 7). Niche banks and payment mediums.

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. not only for those who are marginated in the financial sector.17 CONCEPTUAL FRAMEWORK OF FINANCIAL INCLUSION In a very fast way an international consensus begins to grow on the importance of promoting Financial Inclusion. but also for those who are already part of the financial sector and still don’t know how to take advantage of the potential that services and products offer to them.

deposit services. Superintendency of Banking.1) Table 1. such as weak and low-income groups. a consensus begins to emerge about what are the components that define the conceptual framework of Financial Inclusion. on the need to identify the essential elements that distinguish this term and avoid. Central Bank of India Financial Inclusion is defined as the process of ensuring both access to financial services as well as timely and adequate credit to vulnerable groups. Financial Inclusion means wide access to a portfolio of financial products and services including credit. Thus. However.1 International definitions of Financial Inclusion Institution Central Bank of Brazil Definition Provision of access to financial services designed for the needs of the population. with up to date acceptance. the idea to develop a conceptual framework has been accepted and every country may determine its own definition of Financial Inclusion in relation to it. pensions and payment systems as well as financial education and consumer protection mechanisms. Measurement Working Group of Financial Inclusion Financial Inclusion Components Despite the efforts to create definitions.In recent years. In various countries. the discussion about what should be the universal definition. under appropriate regulation. those responsible for public policies have concurred. For this reason. Insurance and Pension Funds Companies (AFP) of Peru National Banking and Securities Commission (CNBV) Source: Alliance for Financial Inclusion (AFI). in various countries. The access and use of a range of financial products and services by the population that. insurance. as a starting point for a definition of Inclusion. protects the interests of the financial system users and encourages their financial capabilities. Likewise. the term Financial Inclusion began to be used by different actors. The access to financial services and the use of financial products and services are the two concepts. in an affordable way. the majority agreed on including financial education and consumer protection as additional components. 18 . some countries promote the incorporation of other concepts like the payment systems and the population welfare as part of the definition of Financial Inclusion. leaders in public policies have begun to create some definitions (See table 1. at this moment.

and. It seems that there is a preference regarding the type of policies that can be implemented to have an impact on the population. in which the regulation sets the necessary incentives for the promotion of financial products and services in relation to the needs of the different segments of the population.19 While the discussions continue. where appropriate. promote their adaptation. Finally. public policies aimed to improve the quality offered by these services complement a cycle. Graph 1. the development of public policies has been distinguished by actions aimed at promoting the access to financial services. See graph 1. The public policies that promote the access to financial services should be supplemented with use promotion policies. allowing to calculate the impact.2. receiving the support of measuring instruments that set the design as a base for those policies.2 Financial Inclusion Curve Higher number of people included in the financial system Financial Inclusion Curve Quality Usage Increase in financial penetration Better Products More efficiency Access Measurement of Financial Inclusion ( Firms and Individuals) .

National banking reforms. Promote the establishment of government institutions that offer financial services to low-income people. Facilitate the increase and improvement of information on Financial Inclusion issues to stimulate the creation of innovative and successful public policies. Nigeria and Peru. Formalization of micro savings. 20 . Thailand. Facilitate the construction and the use of financial entities for people with a low-income. Measurement of information. Increase access to financial services through the mobile technologies. Consumer protection. These focus areas are: Banking agents. officially established on September 2009. focuses on specific areas that offer a significant potential to increase accessibility in the financial services through policies that have been previously tested in other countries. Facilitate the adoption of new suppliers and products that promote the micro saving. Enable non-banking agents to offer financial services. Currently AFI has over 50 member countries and its steering committee is constituted by representatives of Mexico. This alliance.The Alliance for Financial Inclusion (AFI) The Alliance for Financial Inclusion (AFI) is a network formed by the central banks of some developing countries and other regulatory agencies to share their knowledge and experience in the development and implementation of public policies to promote greater Financial Inclusion. Mobile financial services. Philippines. Kenya. Promote policies that provide consumer protection and an adequate financial education. Financial Identity.

3 The Alliance for Financial Inclusion member countries Africa • • • • • • • • • • • • • Burkina Faso Burundi Camerún Chad Costa de Marfil Gabón Ghana Guinea Guinea Ecuatorial Kenia Madagascar Malaui Namibia • • • • • • • • • • • • Niger Nigeria República Centroafricana República del Congo Ruanda Senegal Sierra Leona Sudáfrica Sudán Tanzania Togo Uganda • • • • • • America Colombia El Salvador Guatemala México Panamá Perú Europa • Bielorrusia Asia • • • • • • • Afganistán Bangladesh Camboya Filipinas India Indonesia Jordania • • • • • • • Malasia Maldivas Pakistán Rusia Sri Lanka Tailandia Yemen Oceania • • • • • Fiji Islas Salomón Samoa Tonga Vanatu .21 Graph 1.

Innovation: Promote technological and institutional innovation as a means to expand the access to and the use of the financial system. 7. 11 3. the G-20 leaders said: “We have developed a series of principles for an innovative Financial Inclusion. 1.” 22 . insurance). A clear regulatory regime for electronically stored value. 2. the importance of the work fulfilled by the Financial Inclusion Experts Group (FIEG) was highlighted. Protection: Foment a comprehensive approach towards the protection of the consumer that recognizes the roles of the government. the national circumstances and favour a competitive environment. Knowledge: Make use of higher quality data to create politics based on the evidence. Market-based incentives that allow as an objective to broaden the interoperability and interconnection. 6. Source: Principles and Report on Innovative Financial Inclusion from the Access through Innovation SubGroup of the G20. Foment partnership and direct consultation between the government. Leadership: Promote a broad-based governmental commitment towards Financial Inclusion with the objective of alleviating poverty. Table 1. 8. which will form the basis for a concrete and pragmatic plan of action to better the access of the economically unprivileged to financial services. Empowerment: Develop culture and financial abilities. which is also based in the understanding of gaps and barriers present in current regulations. 9. Such group suggested nine “Principles for Innovative Financial Inclusion” formed by the Access through Innovation Sub-Group (ATISG)11. the enterprises and other stakeholders. Diversity: Implement public policies focused on promoting a greater competition. acceptable for both the regulator and the service provider. The requirements for the use of agents as costumer interface. 4. payments and transfers. that offer marketbased incentives to supply sustainable financial access for the use of a broad range of services at accessible prices (savings. The principles were derived from diagnostic work and the survey developed by CGAP under the leadership of the Alliance for Financial Inclusion. credit. which were endorsed by Leaders at Summit in Toronto in June 2010.The initiative taken by the Group of Twenty During the G-20 Leadership Summit that took place at the end of June 2010 in Toronto. 5. as well as to favour the existence in diversity of the service suppliers mentioned. suppliers and consumers. Cooperation: Create an institutional environment with clear lines of responsibility and coordination inside the government. flexible and risk-based system of Anti-Money Laundering (AML) and of Combating the Financing of Terrorism (CFT). Proportionality: Build a policy and regulatory framework proportional to the risks and benefits involved in the different and innovative products and services.4 The G-20’s Principles for Innovative Financial Inclusion ATISG developed the following nine “Principles for a New Financial Inclusion”. it must also consider: A suitable. which includes facing infrastructure deficiencies. to measure its progress and consider the increasing ¨trial and error¨ approach. In the Toronto declaration. Regulatory framework: Reflect the international standards.

At the end of July 2010. The most important indicators that resulted from the survey are in the following table. . The principal access indicators. maintaining the stability and strength of the financial systems. This is carried out through periodic interviews applied to the broad net of IMF country members that integrate the International Financial Statistics (IFS) basis. for a period of six years (2004-2009). annually collected. These policy supervisors have also shown their disposition in exploring new implements to better the access to financial services. 12 13 http://fas. The access to financial services and their measurement International Monetary Fund database12 The International Monetary Fund’s “Financial Service Access” project is focused on the annual collection of geographic and demographic information about the access to basic financial services around the world13. To promote investigation and analysis to strengthen the understanding of basics and implications with regard to the financial services access and use.imf. are publicly spread and they allow: To monitor the effectiveness of the policies aimed to increase the access to financial services throughout time. the IMF published the data base that shows the results obtained in its first annual interview (Interview about Financial Service Access). where the IMF is This project was initially financed by the Netherland government and it complements the work fulfilled by the United Nations and the World Bank in the United Nations Consulting Group context about the Financial Inclusion sectors.23 The countries that are leaders in this subject have developed national visions and strategies in Financial Inclusion as a part of their extended plans for economic development. which measured the efficiency of such services in 138 countries.

when showing international comparisons. For this reason. especially in the least developed countries. FMI Financial Inclusion Experts Group. once the coverage of the mentioned data base is broadened. the indicators of the number of bank branches were taken in relation to 10.000 adults Source: Survey of Access to Financial Services. in the present report.000 km 2 Number of bank branches per 10.000 adults Number of depositors of Commercial Banking per 1. it will be possible to carry out comparisons that cover a greater amount of indicators.000 adults Outstanding loans of Commercial Banking (% of GDP) Number of depositors of Commercial Banking per 1.14 In spite of the importance of the information obtained by the interviews. it is necessary to clarify that the data base presents some limitations. the fact that many countries have not provided information is comprehensible because of the existing difficulty to measure these variables.Table 1. as from the total number of interviewed countries. approximately 15% did not present the most recent data in reference to bank branches and 24% did not report information about ATMs.5 Indicators reported in the Survey of Access to Financial Services of FMI Usage of Financial Services Number of providers of Commercial Banking per 1. in the future.000 adults 4 Number of automated teller machines (ATMs) per 1.000 adults and not 100. Graph 1. As for use indicators. only the access indicators will be employed and.000 as it was originally published in the IMF database.000 adults Access to Financial Services Number of bank branches per 1. FMI 14 For the purpose of this report. 24 .000 km2 Number of automated teller machines (ATMs) per 10.6 Percentage of countries that provided information to FMI Banking branches 15% ATM 24% 76% 85% Data reported No data reported Data reported No data reported Source: Survey of Access to Financial Services.

The CNBV presides over this group. promoting better feedback. including Mexico). . especially when many countries did not report data that would allow a much thorough comparative. Germany and the United Kingdom. These groups are: the Organization for Economic Co-operation and Development. 15 16 This effort of international comparison was initiated by The Consultative Group to Assist the Poor (CGAP). Further on. (See Annex 7 with information about the associate countries.25 On the other hand. Some countries that integrate these groups do not show in the graphs due to the fact that they were not included in the IMF interview. Table 1. Such group centered itself in the establishment of certain bases about the components of this compilation. this group will broaden the debates so that a greater number of countries. 26 participants responsible for public policies shared their broad experience in the compilation of information about Financial Inclusion. may expose their ideas and experiences. it is complex to analyze the precise position that Mexico occupies in a matter of financial service access. Source: AFI Mexico’s position in the access to financial services15 From an international perspective. a comparative indicating the number of branches for every 10. as they reported a greater amount of information in comparison with other countries like France. AFI members. In it. with the objective of having a better dimension of Mexico’s position in relation to the countries interviewed by the IMF. as well as determining the way in which such initiatives from its members on compiling relevant data will be supported. American Continent and Members of the Alliance for Financial Inclusion (AFI)16. the Group of 20 (G-20).7 The Financial Inclusion Data Working Group from AFI The Financial Inclusion Data Working Group (FIDWG) was created on June 2010 in Kuala Lumpur during a forum organized by the AFI and the Central Bank of Malaysia. In the future. However.000 adults for each one of the four groups previously mentioned. such countries were organized in four principal groups where Mexico participates because of economic or geographic matters. the role assumed by the countries affiliated to the AFI during the database collection in this project becomes relevant.

7 n.d n.8 South Africa Indonesia Russia n.8 0.5 Japan India Saudi Arabia 1.6 3.3 New Zealand Ireland Australia Holland Canada Czech Republic Republic of Korea Turkey Mexico 1.d n.8 Comparative of Mexico with other countries in the number of bank branches for every 10.8 United States Australia 3.2 1.2 2.d Switzerland Iceland Slovakia England France Belgium Germay England France China Republic of Korea n.Graph 1.4 1.d 0.d”.d n.9 Brazil Argentina 1.8 Italy 6.d n.5 3.6 3.2 3.9 Hungary Turkey Mexico Finland Japan Austria Norway Luxemburg 1.2 0.2 6. 26 .d n.d n.5 1.3 1.1 3.d 17 The countries that did not report data for these indicators are shown with the inscription “n.6 4.4 1.d n.4 2.d n.8 1.8 4.6 3.5 2.9 Canada 2.8 1.1 0.4 1.6 4.d n.d n.000 adults7 OCDE17 Portugal Italy Poland Denmark Greece Spain United States G-20 8.2 1.

1 0.1 1.2 1.27 AFI Guatemala Tonga Jordan Maldives Mexico Thailand Malaysia India The Solomon Islands Pakistan South Africa Indonesia Namibia Philippines Peru Bangladesh Ghana Equatorial Guinea Gabon Kenya Togo Cambodia Belarus Sierra Leone Rwanda Yemen Tanzania Magadascar Afghanistan Cameroun Chad Russia Uganda American Continent 3. Vicente y las Granadinas Chile 2.9 0.4 0.7 0.2 n.6 2.000 adults in comparison to some developing countries as. Argentina.5 Monsterrat 10.d n.d United States Guatemala Antigua y Barbuda 3.d Peru Jamaica Guyana n.3 2 1.d n.d n.3 0.d n.5 0.8 1. Brazil.d n.4 Sta.9 Anguilla Sn. FMI Even if Mexico presents certain deficiencies when comparing it to more industrialized countries. for example. Kitrs y Nevis Granada 4 4.5 0.d n.1 1.6 2.d Costa Rica Source: Survey of Access to Financial Services.8 0.5 0.d n. South Africa or India. as well as the broad field of action for the design of public and regulatory policies that allow the extension or limitation of the access channels to financial services.5 2.7 Dominica Mexico 1.4 0.5 1.9 Belize Canada 2.5 0.4 Brazil Uruguay Argentina n. Turkey. it is meaningful to mention that it is placed in important positions in relation to the number of branches for every 10.d n.8 0.d n. Lucia Sn.d Haiti Bahamas n.d n.d n.d n.7 0.4 0.7 0.9 0. .7 0.6 1.8 1.9 1. This clearly shows the effort made by the financial institutions.7 8.6 3.

financial services to its clients. with the purpose of encouraging the inclusive efficiency and development in the Mexican Financial System (SFM. like the simplified regime for an opening account. in relation to those who represent the traditional bank branches. will be described in future reports. has designed concrete actions that impact different components of Financial Inclusion. The banking agent is a third party that establishes relationships or business links with a credit institution. with the objective of offering. new regulations for Banking Agents. December 2nd 2008. in the Spanish abbreviation). An example is the commercial establishments empowered to offer financial services provided by the bank19. demonstrates his experience and technical capacity to the regulatory board.9 Requirements for banking agents Who can be a correspondent? Corporate entities or individuals with enterprise activity With a permanent address With a particularly qualified kind of business With the necessary infrastructure to fulfil its operations With the certified staff to operate technological mechanisms With an acceptable business and credit record Without a criminal history (felonies or frauds) Source: CNBV 18 Other initiatives. and Niche Banks and Payment Means (switches)18 may be identified. According to the regulation established for such an effect.9 are fulfilled. by means of the financial institution. The banking agents represent a more accessible alternative for the user as a result of its high penetration and lower costs. a person may become a banking agent that. Table 1. in the name and account of the former.New Regulation in Mexico to promote greater Financial Inclusion The Federal Government. Mobile Phone Banking Agents. once the requirements on the following table 1. through the increase of distribution spots of financial services. The regulation that corresponds to the hiring of third party services or commissions appears on the XI th chapter of the Banking Act published in the Official Gazette of the Federal Government. Through some of the most outstanding actions. 19 28 . Banking Agents A banking agent is a new figure promoted by the Federal Government to incentive greater Financial Inclusion.

The allowed operations are described in table 1. . a receipt of the operation must be generated for the costumer. in the correspondent accounts in accordance with the operations that are taking place. which allow the verification of the identity of both the costumer and the banking agent.29 The banking agents act as a counter between the financial institution and the costumer. at all times.10 Allowed operations Operations charged to the banking agent Services payed in cash. In addition to the electronical registry of all operations. the financial institution is the one responsible for all the operations of the costumer. It is important to remark that.10. cards or checks from any institution Payment system circulation (pre-payed cards) Operations with deposit to the correspondent Cash withdrawal Other operations Account balance and movement consultation Funds transference for the payment at bank branches of the same institutions or at banking agents (Remittance) Check payment from Source: CNBV All the operations must be fulfilled in real time and account for authentification factors. however the client-correspondent correspondent-bank transactions are fulfilled through real time charge and payment operations. fulfilled through his banking agents. Table 1. cards and checks of the institution Casho or check depostis from the institution Credit payment by cash.

the regulation permits the Banking Agents Administrator figure (see table 1.500 UDIS daily 1. 30 Others Payment .500 UDIS daily Without limit Without limit Without limit Without limit Without limit Without limit Without limit Source: CNBV Banking agents administrators According to the existent interaction between the banking institution and its banking agents.000 UDIS daily Banking agent limits Without limit Charge Deposits Loan repayments Payment methods Cash withdrawal Check payment Check balances Funds transfer 25% of monthly average flow of the last 12 Without limit Without limit Without limit 1. it is possible for the bank to delegate the hiring and the administration of its banking agents to a solicitor entity.11 Summary requirements by type of operation Technological Requirements Operation On line Payment for services Yes Yes No Yes Yes Yes Yes Yes Operator Identification Yes Yes Yes Yes Yes Yes Yes Yes Equipment Identification Yes Yes Yes Yes Yes Yes Yes Yes Client authentication 1 1 1 1 2 2 1 2 Generate electronic record Yes Yes Yes Yes Yes Yes Yes Yes Generate proof Yes Yes Yes Yes Yes Yes Yes Yes Limits on Operations Customer limits Without limit 10. in other words.Table 1.12). For this purpose. the business model may be fulfilled in a direct or indirect form.

it is considered that with this action a greater geographic coverage at a lower cost may be achieved. In urban areas.31 Table 1. . Yet. The banking agent. if it’s reinforced with acquisition outlines (Member Get Member)20. will allow financial institutions to increase their clientele by intensifying the geographical expansion of their services. 20 Fidelization and affiliation growth concept contemplating already registered members. which represents a cost reduction for the financial institution. the former of which. apart from acquiring greater convenience and accessibility. In rural and semi urban areas (characterized by low levels of Inclusion). it allows the standardization of the operative and technological systems. being a close and familiar spot for the population that makes daily usage of the correspondent’s establishment. may participate actively as a financial service promoter. which will allow them to gain new clients and strengthen the loyalty of former clients. far beyond functioning mainly as a retail spot for the financial institution. it can catalyze significantly the confidence and familiarity with the financial system. among other advantages. the banking agents allow the clearing of branches. incorporating the unsatisfied demand to the financial system. substituted basic financial services by informal. due to the high transaction costs. Business models The purpose of the modality of banking agents is to promote new models of profitable businesses that. unregulated services at the margin of the banking system. At the same time. At the same time. which will have the effect of lowering the final user’s commissions. through cost reduction. the commercial establishments will acquire comparative advantages in relation to their competitors when offering financial services.12 Functions of a Banking Agent Administrator Possible functions of a banking agent administrator Identify and select suitable banking agents Human Resources: training and incentive schemes Technical support and emergency response Marketing consultancy Risk management and profitability assurance Balance the cash flow needs of its network ("Common Fund") Follow up and resolution of legal conflicts Source: CNBV A banking agent administrator facilitates the network’s growth and decreases the costs associated to its installation when taking advantage of economies of scale.

credits. The nonbanked users receive the opportunity of accessing basic financial products and services in the establishments which are closer and more familiar. rapidly maximizing the geographical coverage of the basic bank services offer. In the rural areas. therefore. promoting Financial Inclusion. Independently from the extension of their traditional branch network.13). in contrast with traditional branches. mobile payment and electronic charge purse (See table 1.13 Business lines for mobile phone banking agents Mobile bank Additional access channel for current bank customers Trasactions for higher amounts Mobile payment Electronic purse Access channel to financial system Associated to pre-payed bank cards by the non-users or mobile accounts Transactions of low amounts Low amount transactions Link to investment accounts. debit and debit cards. the government organisms and distribution networks of social programs may serve as spots for the construction of broad banking agent’s networks in areas of a low population density. Table 1. There are three business lines for exploring this technology. The costumers benefit because. their travelling expenses are reduced. Mobile phone banking agents The mobile phone banking agents represent a safer. where big chains don’t have such a strong presence and it’s more difficult to find establishments that carry out the requirements to act as banking agents. Likewise. This impetus will generate associations between banks. among or credit cards others Source: CNBV 32 . when relying on more distribution spots. efficient and inexpensive way of promoting the access to financial services through the expansion of the offer of products related to mobile phone devices.The greater beneficiaries of this outline are both the banked users and the non-banked ones. chains and commercial establishments. credit Charged to a mobile account. the administrative figure of networks provides a viable alternative for the expansion of banking infrastructure. of lesser resources and that are rural. the bank institutions may benefit from the construction of a banking agents network which will allow them to expand their backbone clientele and gain a notable presence in more locations. mobile bank. facilitating financial access and.

providing a low-income population with access to the system of electronic payments. address and date of birth. low risk account and low transactionality account. Due to the fact that the mobile payment is characterized by transferences of a lesser amount. anticipates certain measures that offer safety in the transactions having as an objective the generation of the necessary trust the user counts with to employ this medium and fulfill financial transactions at ease. the operations made in this way are subject to simplified requirements. . This proportionality in the regulation allows the proliferation of products focused on offering transactional services of low amounts at lower costs. Depending on the information requirements that the customer must present for its opening. the regulatory framework forecasts the existence of Mobile Accounts21. electronic transferences (in accordance with the limits established for each type of account) and cash or check deposits. On the other hand. 21 Circulars 2019/95 and 1/2006 from Mexico’s Central Bank.33 As a vital complement to the introduction of the mobile phone banking agents figure. defined as accounts associated to a mobile phone line. they are catalogued in three types. Table 1. No physical the course of a calendar month record is required Source: CNBV based on the general character dispositions to which the article 115 from the Law of Credit Institutions issued by SHCP refers to A mobile account allows carrying out balance consultancies. as with other bank accounts from other institutions. The control measures are proportional to the risk that each one of the services represents. The institutions must permit transferences between mobile accounts. A physical record is not required It will be established by each bank and approved by the CNBV b) Low risk c) Low transactionality The costumer must only provide his full 2. in use of mobile telephony as a channel to provide and utilize financial services.14 Business line requirements Mobil account a) Unlimited Information requirements Maximum amounts The correspondent must integrate a file with the same information required for a normal Without restrictions bank account The costumer must identify himself presenting the required documents. mobile unlimited account.000 Udis per customer per bank in name. prohibiting the charge of interbank fees by this concept. cash withdrawals. on the maximum monthly amounts allowed for transactions and on the balance that an account may be registered by. the regulatory framework.

500 UDIS daily and 4. One of them must be for micro payments Yes Not necessary 1.15 Control measures Measure Number of accounts associated to each mobile phone Restriccion of one mobile phone per user12 Double authentication from the customer Transactional limit Destiny accounts register Requires security mechanisms in the transmission of sensitive information Protect the NIP in the screen Notifications when fulfilling operations Fraud prevention systems Kwow Your Customer procedures (KYC) Temporary deactivation of service Mobil payment Up to two accounts.Table 1. 34 . for operations up to 1.000 monthly No. simplified Yes Mobil bank It is possible to associate the accounts determined by the customer Yes Yes Defined by the customer Yes Yes Yes Yes Yes Yes Yes Source: CNBV22 22 Cell phone is used like means of identification of the client. for operations <250 UDIS Yes.500 UDIS No Yes Yes Yes Yes.

so that they don’t coincide with the employed regions in this report.16 shows the possible transformation of the mobile phone users into users of financial services through a comparative between the percentage of debit cards users and the percentage of cell phone users. The regions of this graph are defined by COFETEL. as in the abbreviation in Spanish) and the CNBV 24 23 24 In accordance to the Federal Telecommunications Commission (COFETEL). based on the provision of financial services via these devices. Table 1. have a very high potential to promote the access to and use of financial services.35 Due to the familiarity with which the cellular phone is used today and its effect on 77%23 of the population.16 Possible impact of the use of cellular phones as banking agents 14 93% 88% 74% 66% 57% 90% 55% 59% 47% 32% 42% 59% Norteast North Northwest Center West Gulf and South Southeast % Cellphone users Metropolitan % Debit card users Potential growth Source: Elaborated with information from the Telecommunications Federal Commission (COFETEL. Graph 1. the different business models. .

In this way. All those mentioned by Article 46 in the Law of Credit Institutions. However. Given the faculty to take deposits from the public.17 Levels of the minimum capital for Commercial Banking15 Operations permitted Institutions that fulfill all the activities 16 Institutions specialized in local operation Institutions specialized in financial service corporatives Institutions specialized in issuing payment means Source: CNBV2526 Minimum capital 90 million UDIS 54 million UDIS 36 million UDIS 36 million UDIS 25 26 In agreement with what was established in Article 19 of the Law of Credit Institutions. recognizing that the specialization of its services represents a lesser risk for them than the one faced by the institutions that fulfill a broader spectrum of the services allowed for a commercial bank.Niche Banks The figure of Niche Bank refers to a newly specialized intermediary. This means that the Niche Bank may obtain a banking license with a relatively lower capital. Table 1. with the possibility of taking deposits from the public and with complete access to the payment system. the Niche Banks are subject to the regulatory standards equally applicable to the Commercial Banks in prudential maters. the minor costs associated with a license to operate as a Niche Bank reduce the entrance barriers to this market for the bidders of a smaller size that are looking to focus on a particular market or product. the niche banks have a lower minimum capital requirement. 36 .

“Published on the website of the CNBV by Economic Studies General Direction. Until early 2010. to establishments that accept banking cards as a means of payment through points of sale terminals (POS) installed by acquiring banks and. transmitter of electronic payment means. etc). which allows commercial associations and. Payment systems and Clearing Chambers (Switches)27 The switches are private enterprises that offer information transmission systems connected. Unilateral criteria determination and unclear policies of market entry and pricing structures by dominant participants. the sum of positions between these banks as well as the fees generated by the exchange of payment authorizations. on the other hand. They also function as a clearing chamber. . seeks to increase the competition in this market and the proliferation of this type of products at a lower cost for the users. Barriers for the entrance of new switches. Also. compensation chambers (switches) in Mexico operated under a scheme characterized by entry barriers and obstacles for competition due to: The implementation of a discriminatory structure of prices based on the number of operations (providing the exclusion of smaller participants). mobile accounts. it favors the substitution of cash by developing payment means of free acquisition and low transactionality.37 This measure seeks to promote Financial Inclusion through a better market segmentation and the development of new financial products. establishing a connection of high costs and other technical barriers. In addition. A rule that allows being a purchaser only to those participants in the market who also participate as issuers. Discrimination based on prices for banks without equity stock participation in the two switches operating in the country. To have as a characteristic the specialization in fundraising for the issuance of electronic payment means (pre-payed cards. on the one hand. it provides greater protection to the consumer for being supervised institutions with prudential regulation. The Niche Bank. to the banks that issue banking cards which authorize the charges to the debit or credit cards. charging the amount of the transaction to the bank issuer of the card. strengthens the access of the population that is currently unattended by traditional banking. 27 See the document: "Is it sufficient for the exchange fees to be competitive? Issue-acquirement market evidence in Mexico. in addition. the electronic payment means may lead towards a more complete banking process. by the end of the day. debit cards. paying it to the acquiring bank and settling. The possibility of making electronic payments and transfers generates important benefits for the population that currently cannot access the financial system.

making the market purchasers more appealing and generating lower discount rates. and promoting operational expertise of the switches. Incentives to broaden the penetration of points of sale terminals by promoting competition in the acquiring market. Increase the control of the authority over market participants and their operations. Thus. increasing the attractiveness and feasibility of use of electronic payment means. 38 . both for switches and new purchasers. The above results in benefits for users of the payment system. In particular. by introducing authorization rules and specific operations. Consumer prices lower and more transparent. without interconnection charges.To face this situation. when promoting a further expansion of market purchasers. regardless of size or shareholding. to the extent that competition in the merchant acquisitions and switches reduces the discount rates and costs for processing services and settlement payments. enabling the specialization in switching activities and allow the entrance of non-banking participants. it is considered that under the new scheme of operation there are greater incentives to increase the network of point of sale terminals. on May 2010 a reform was adopted in order to make it a requirement for authorized switches to intertwine. Equalize conditions for market entry. and encourages competition as well as a more efficient price structure. the main benefits expected from the approval of the initiative reform are: Decrease the power of the dominant banking institutions on the structure of prices and costs. It is hoped that through this action the problems identified in terms of competence and entry barriers in the offer of services related to the payment system will be addressed. Increase the bargaining power of purchasers against issuers.

CNSF. both files are available at the website of the CNBV. for its Mexican abbreviation) of the National Banking and Securities Commission. For more information regarding this methodology refer to the document “Financial Savings and its intermediation in Mexico (2000-2010)” as well as the database.39 MACROECONOMIC 28 INDICATORS In order to identify which are the relevant macroeconomic indicators for Mexico. . INDEVAL and SHCP. To understand the financing dynamic helps to identify which are the incentives and disincentives that intermediaries have for obtaining and canalizing resources of specific segments of savers and which determine the strategies of the financial system for obtaining resources. 28 Indicators and analysis of this chapter were elaborated by the General Direction of Economic Research (DGEE. such as: Banxico. it is necessary to identify all the components that integrate financial savings and understand if their incorporation to the financial system is linked to financing decisions and to private or public investment. CONSAR. based on public sources of information.

in this document only bank deposits and fixed rent values are considered. 40 . in this definition we have only included those institutions that are regulated by the CNBV and other authorities. The information of their investment portfolio is obtained from CONSAR.2. as it can be seen in graphs 2. fixed or variable rent values generated by the public sector and both national and foreign companies30. which keeps track of these funds on an annual basis. the behavior and usage of saving sources can be better understood by decomposing each of the instruments of the system itself and.1 Structure of financial savings * Private pension funds are considered as individual investors because they are created by corporations to manage the resources for the retirement of their workers. such definition considers as savings the balance of such actives and not their flows as some other perspectives which are used frequently (for example.1 and 2. The financial savings of the economy could be defined as the value of the financial assets and values held by individuals and corporate entities (both residents and foreigners) who are intermediaries through financial entities regulated in Mexico29. savings measured towards national accounts). Graph 2. it is necessary to understand the structure of financial savings and understand their usage in Mexico. Such assets could be: bank deposits. 30 As the values of fixed rent are also considered as part of financial savings. From a Financial Inclusion point of view.Relevant macroeconomic indicators In order to identify the relevant macroeconomic indicators. 2 Although other savings and credit mechanisms exist that are offered by non-regulated entities. providing services too. On the other hand. of each intermediary.

41 Graph 2.2 Structure of financing in Mexico Source: CNBV Graph 2.3 shows the composition of the financial savings as a percentage of the Gross Domestic Product (GDP). These three groups form almost 40% of the savings composition in the last 3 years. Here it can be observed that the banking system has a greater participation in such composition. followed by external savings and that savings made by corporate entities and particulars. .

individuals and revolving treasuries /4 Pension funds 3/ Insurance companies Foreign savings 5/ 1/ Figures as of March 2010. representing close to 10% of the GDP. 2/ Other sensors include Popular Savings & Loans Institutions and Credit Unions. 42 . In graph 2. including such entry is useful as it illustrates the amount of resources available at hand for intermediaries. SHCP and INEGI / Figures as of March 2010. The position of banks and brokerage firms has reduced their participation since 2004. 32 It is important to point out that the position of banks could double some entries of saving. To observe the behavior of such components of savings. However. have represented 3% of the GDP in the last 3 years31.Graph 2. while relevant treasuries. 3/ It include assets issued in México in hands of non-residents. Source: CNBV with data of Mexico's Central Bank. other sensors 2/ Investment companies Corporations. Indeval. whose information can be disaggregated from 2008.3 Financial Savings as percentage of the GDP 75% 17% 52% 14% 14% 13% 12% 1% 2% 6% 17% 2% 3% 7% 17% 16% 15% 16% 2% 4% 9% 18% 15% 14% 12% 13% 15% 16% 14% 2% 3% 8% 17% 15% 2% 4% 10% 15% 2% 5% 11% 16% 2% 6% 11% 15% 3% 7% 15% 3% 6% 12% 14% 3% 6% 13% 16% 2% 7% 14% 12% 18% 18% 17% 18% 20% 20% 19% 1/ 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Commercial and State-owned banks. as we are aware that the acquisition of savings is backed up by their own assets. it is observed that corporate entities and particulars have contributed importantly to savings. maintaining a 4% since then32. some additional disaggregation in certain topics can be made. 31 Relevant treasuries are those treasuries that belong to a certain institution (either public or private) and that have a large size. CONSAR. assets issued abroad and credit granted by foreign financial institutions. but we are not certain on which part of such savings is backed up by their loan portfolio and which part on their own investment portfolio.4. enough to have an account registered at Indeval.

5. increasing their participation from 2% in 2000 to 9% in 2009 and 5% in 2010. particulars. relevant treasuries and position of intermediaries as percentage of GDP 16 % 12% 4% 5% 5% 6% 5% 4% 4% 3% 2% 3% 8% 9% 10% 9% 10% 12% 11% 10% 4% 4% 3% 6% 8% 8% 9% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Corporations.43 Graph 2. the SIEFORES and the housing funds have been the main ones responsible for this growth. which has increased more than double in size from 2000 to 2010 as a GDP percentage. CONSAR. .4 Companies. 1/ Figures as of March 2010. As it is shown in graph 2. Indeval. Similar in importance for the financial savings is the Savings System for Retirement. respectively. SHCP and INEGI. individuals and Revolving treasuries Revolving treasuries Individuals and corporations Banking and Brokerage Position 1/ Source: CNBV with data of Mexico's Central Bank.

securities issued abroad and loans granted by foreign financial institutions.6 External savings as percentage of GDP 17% 14% 8% 8% 9% 10% 10% 8% 9% 7% 7% 10% 10% 6% 6% 6% 6% 6% 5% 5% 6% 7% 6% 6% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 External savings that finance to private sector 2/ External savings that finance to public sector 3/ 1/ Source: CNBV with data of Mexico's Central Bank.Graph 2. 1/ Figures as of March 2010. Also. among the external savings. 1/ Figures as of March 2010. 44 . Indeval. SHCP and INEGI. Indeval. SHCP and INEGI. the one with a greater participation has been used to finance the public sector. CONSAR. Graph 2. 2/ 3/ It include securities issued in Mexico in hands of non-residents.5 Saving system for retirement as percentage of GDP 14% 1% 1% 1% 1% 4% 4% 0% 1% 3% 3% 3% 1% 4% 1% 4% 1% 5% 4% 1% 5% 6% 1% 2% 2% 4% 4% 5% 5% 6% 7% 7% 7% 8% 9% 1/ 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 SIEFORES Housing Funds IMSS and ISSSTE (SAR 92) Source: CNBV with data of Mexico's Central Bank. although this contribution has maintained itself relatively stable in time. CONSAR.

CONSAR.7 shows the balance of circulating debt and given credits as GDP percentage. Up to March 2010. public circulating debt is 31% of the GDP.7 Balance of circulating debt in Mexico and given credits as percentage of GDP 73% 14% 45% 15% 14% 14% 18% 12% 1% 4% 1% 13% 15% 1% 5% 1% 12% 1% 5% 2% 13% 16% 15% 13% 10% 11% 13% 14% 20% 21% 23% 26% 27% 27% 30% 31% 2% 6% 2% 13% 2% 6% 2% 12% 2% 6% 2% 14% 2% 6% 2% 15% 2% 6% 2% 17% 2% 6% 1% 17% 2% 6% 1% 17% 2% 7% 1% 18% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/ Bank credit and other sensors loans INFONAVIT and FOVISSSTE loans Public debt issuance in Mexico Other intermediaries loans Private debt issuance in Mexico Outstanding debt and loans issued/originated abroad Source: CNBV with data of Mexico's Central Bank. Indeval. Graph 2. Graph 2. SHCP and INEGI. followed by bank credits and circulating debt and credits issued and/or generated abroad. which represents one percentage point more that in 2009. where public debt represents the most significant percentage of financing.45 Financing can be understood as the value of debt circulating in the market of values and the credit amount that regulated institutions give to the public sector as well as to the private one. . 1/ Figures as of March 2010.

On the other hand.8 the forced and voluntary savings as a GDP percentage is shown. the employees and the Federal Government contributions in the social security system and the retirement funds. Due to changes in the retirement funds since the beginning of the 2000 decade. 46 . and its growth rate between 2000 and 2009 was 3. forced savings have represented 20% in average from the total internal financial savings.4%.Forced and voluntary financial savings Once the components that integrate financial savings are identified. c) which are the main savers. in particular. This way of classifying financial savings is important because behind the savings’ volume there are mandatory employee contributions as well as household and company decisions. brokerage firms and investment societies. The high participation of voluntary savings makes it important to understand: a) how is it that voluntary savings arrive to the financial system. the latter can be regrouped in order to identify if such savings are forced or if these are voluntary. The savings dynamic is pending on the growth of these economic agents and of their access to financial services that are offered by intermediaries. that is to say. In graph 2. and 2) the investments that the pension funds do in the established system. Between 2000 and 2009. voluntary savings have represented 80% of the total. b) which are the tools that obtain it and that head it into financing. in Mexico an important growth of the forced savings has been observed. for households (including those employees of an informal sector). such as: 1) the employer. This second group represents a voluntary saving that concretes itself through banks. The first have a forced origin and their mechanisms towards the Mexican Financial System (MFS) are based in legal fundaments. its average annual growth rate as a GDP percentage was 10. if their channeling into the financial system is due to a private decision or a public decree. from 2000 to 2010.3%.

which registered a deposit balance of 329 mp and 48.47 Graph 2.9. IMSS and ISSSTE contributions and the housing funds INFONAVIT and FOVISSSTE. investment companies. CNSF and INEGI 1/ Figures as of March 2010. the EACP and the SOFIPOS. respectively. 33 Denominating “other sensors” includes Credit Unions.000 mp in March 2010. individuals. as can be seen in graph 2. 2/ It includes SIEFORES savings.8 Forced and voluntary savings as percentage of GDP 60% 50% 40% 30% 20% 10% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/ Forced Domestic Savings 2/ Voluntary Domestic Savings 3/ Source: DGEE with data of Mexico's Central Bank Indeval. 3/ It includes savings canalized through banks and other sensors. . revolving treasuries and intermediaries position. corporations. Most of the voluntary savings become a value handled by the general population and bank deposits and other sensors33.

57% of total internal financing was absorbed by this sector35. and State and Municipal Governments. IPAB. In graph 2.9 Voluntary savings per intermediary as percentage of GDP 45% 32% 10% 9% 4% 2% 5% 3% 5% 3% 11% 12% 12% 13% 14% 14% 14% 13% 14% 6% 4% 6% 4% 5% 5% 4% 6% 4% 3% 6% 4% 6% 4% 7% 7% 17% 17% 17% 18% 18% 18% 17% 18% 20% 20% 19% 1/ 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 Banks and other sensors 2/ Investment Companies Banks and brokerage position Corporations. Banxico. 48 . 2/ Other sensors includes Popular Savings and Loans Sector and Credit Unions. the main user of financial savings is the public sector: between 2000 and 2009. individuals and revolving treasuries through brokerage and banks Source: DGEE with data of Mexico's Central Bank Indeval. Non-centralized organisms and companies. 35 Public sector includes Federal Government. FARAC.10. CNSF and INEGI 1/ Figures as of March 2010.Graph 2. the historical internal financing for the public sector and non-financing private sector as a GDP percentage may be observed. 34 Financing is defined as the balance of circulating debt in the market of values and credit given by Regulated Institutions to both public and private sectors. are defined by strategies of uptake of the financial system. In Mexico. Channeling savings in Mexico It is not possible to understand the savings’ dynamics without explaining the behavior of financing34 as the incentives and disincentives used by intermediaries to channel savings.

which can be observed in graph 2. CNSF and INEGI 1/ Figures as of March 2010.11 Internal financing to public sector as a GDP percentage 40% 35% 30% 25% 20% 15% 10% 5% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/ Public sector credit Outstanding Public debt securities Total Source: DGEE with data of Mexico's Central Bank Indeval. in fundamental aspects.10 Internal financing to public and private non-financial sector as a GDP percentage 60% 50% 40% 30% 20% 10% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/ Public Sector Private Sector Total Source: DGEE with data of Mexico's Central Bank Indeval. CNSF and INEGI 1/ Figures as of March 2010. Most financing for the public sector (84% on average between 2000 and 2009) has been given towards placing debt titles.11.12. as shown in graph 2. .49 Graph 2. Graph 2. as only 8% of total financing for this sector is due towards debt issuance. housing and commercial. On the other hand. financing the private sector is linked to banks: consumption.

SHCP and INEGI 1/ Figures as of March 2010. 50 .12 Internal financing to private non-financial sector as a GDP percentage 30% 25% 20% 15% 10% 5% 0% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 1/ Outstanding private debt securities Housing loans Trade loans Consumer loans Source: DGEE with its own data. Mexico's Central Bank.Graph 2.

36 The World Bank has conducted a survey since 2002 focused on companies in 123 developing countries known as Enterprise Surveys. corruption. infrastructure. Financing the productive sector and financial inclusion Financial inclusion not only comprehends access to saving sources or household financing. crime. Graph 2.13 Domestic loans given to private sector as a percentage of GDP (2008) Argentina Mexico Peru Philippines Kenya Colombia Nigeria Romania Bangladesh Russia Poland India Brazil Hungary Chile Malaysia China South Korea Thailand South Africa Spain 14% 22% 25% 29% 30% 34% 34% 38% 39% 41% 50% 51% 56% 70% 98% 101% 108% 109% 113% 145% 201% Source: World Development Indicators. According to a survey conducted by the World Bank. but it also relies on resources available by the productive sector of the country. World Bank and CNBV for Mexico’s data. Data used for these graphs can be found at www.enterprisesurvey. etc. among the developing countries36. Mexico is one of those economies with the lowest percentage of companies with access to credit or loans from any financial institution.51 However. with respect of comparable countries. Such survey is representative for the business sector of each country and covers a wide range of topics related to business including financing access. competence. .org. Mexico is located at the second to last place in credit given to the private sector as percentage of the GDP.

52 South Africa (2007) Nigeria (2007) Poland (2009) Russia (2009) Peru (2006) . in the first place. World Bank. those figures are lower than the average in similar countries. In 2006. In graph 2. which suggests a low penetration of the financial system in the business sector. Also. it can be observed that in Mexico the investment in fixed assets and the companies’ labor capital is financed.Graph 2.14 Percentage of companies with a credit line or loan from a financial institution 73% 70% 69% 65% 60% 52% 51% 50% 43% 42% 39% 33% 31% 30% 25% 11% 4% Colombia (2006) Romania (2009) Thailand (2006) Hungary (2009) Malaysia (2007) Mexico (2006) Chile (2006) Brazil (2009) Kenya (2007) Argentina (2006) Philippines (2009) Bangladesh (2007) Source: Enterprise surveys.06% via share issuance.15. the financing to business investment in different countries is shown. only 15% of the investment of Mexican enterprises was financed through bank credits or debt issuance and . throughout suppliers or the external market. with their own means.

lenders. World Bank.15 Financing for business investment China (2003) Thailand (2006) Peru (2006) Malaysia (2007) Colombia (2006) Brazil (2009) Chile (2006) Average India (2006) Spain (2005) South Africa (2007) Argentina (2006) Bangladesh (2007) Nigeria (2007) South Korea (2005) Kenya (2007) Mexico (2006) Philippines (2009) 0% 20% Own resources 1/ Other 3/ Suppliers credit 5/ 40% 60% 80% 100% Bank credit 2/ Foreign resources 4/ Source: Enterprise surveys.53 Graph 2. 4/ Proportion of fixed asset purchases financed with social capital or share issue 5/ Proportion of fixed asset purchases financed with suppliers credit . relatives. etc. 1/ Proportion of fixed asset purchases financed with own resources and / or retained earnings 2/ Proportion of fixed asset purchases financed with bank loans 3/ Proportion of fixed asset purchases financed with debt issue. non-financial institutions.

16. Mexico’s Central Bank and INEGI. which can be seen in graph 2.This is also reflected in the market value of the bonds issued by private sector in Mexico as a GDP percentage.16 Private sector bonds in stock markets 71% 38% 41% 19% 11% 1% 1% 1% 2% 2% 3% 4% 4% 5% Malaysia China Brazil Mexico (2009) Source: World Federation of Exchanges and World Bank. Graph 2. being one of the lowest among comparable countries. 54 South Korea Argentina South Africa Colombia Thailand Russia Spain India Chile Peru . Mexico’s data: DGEE.

while the enterprises do not have access to financing sources. World Bank.17. while the average in comparable countries is around 17%. lenders. . 1/ Proportion of working capital financed with own resources 2/ Proportion of working capital financed with bank loans 3/ Proportion of working capital financed through non-financial institutions.17 Enterprises labor capital financing China (2003) Thailand (2006) Colombia (2006) Brazil (2009) Malaysia (2007) Peru (2006) Chile (2006) India (2006) Average Romania (2009) Hungary (2009) Spain (2005) Poland (2009) South Korea (2005) Mexico (2006) South Africa (2007) Argentina (2006) Russia (2009) Philippines (2009) Kenya (2007) Bangladesh (2007) Nigeria (2007) 0% 20% 40% 60% Bank credit 2/ Capital 4/ 80% 100% Own resources 1/ Other 3/ Suppliers credit 5/ Source: Enterprise surveys. competition among intermediaries for financing enterprises will decrease. etc. both from the market value and the banking system. in Mexico only 2% of labor capital is financed with bank credit. Graph 2. as shown in graph 2. 4/ Proportion of working capital financed with foreign resources 5/ Proportion of working capital financed with suppliers credit Therefore. relatives.55 In the same way.

the InterAmerican Bank for Development and the National Banking and Securities Commission. investments and insurance to improve productivity. of private nonfinancing enterprises. With this survey it will be possible to stratify the information by size of the company and size of locality. the survey takes into account specific characteristics of the company such as: its level of formality. access and usage of financial services (ENE) The national business survey on competitiveness and access and usage of financial services is a joined effort of the Bank of Mexico. giving new information regarding the penetration of other financial services and exploring the elements that affect the competitiveness of non-financing enterprises. Such survey will be held in the second half of 2010 with the objective of obtaining information. on a national level.Table 2. It also identifies the main barriers found by entrepreneurs to use the financing infrastructure more efficiently. which will produce quantitative information on usage and sources of financing. In this respect.18 National business survey on competitiveness. income-expenses. main sources of financing (including both formal and informal) and the usage of payment means. Source: CNBV 56 .

The figures presented are from March. which are defined as channels. Branches or service offices. . selling points. therefore. 2010. allowing the suppliers to develop new products and services. ATMs. Internet and correspondent networks (traditional and mobile phones) are distribution channels of financial services. The scope of the infrastructure available for offering financial services is determined by access points between people and financial institutions. analyze if the infrastructure to offer such services is adequate for each type of population.57 ACCESS INDICATORS Access indicators for financial services allow us to evaluate the penetration of the financial system in the country and.

semi-metropolis and metropolis.1 Classification of institutions that offer financial services PSLI Commercial Bank Cooperatives Micro Finance Stateowned Bank Non Regulated Institutions Non attended Source: CNBV 37 Classification taken from CGAP in their report “Financial Access 2000”. those who could be attended because of having a branch in their municipality. 4. other indicators are included in order to show the number of access points (branches or service offices). the amount of municipalities where an access point is located (mainly branches) and the number of adults with the possibility of accessing it. The point of sale terminals (POS) are present at a municipality level to fulfill information of branches and ATMs with identical detail level. urban. B 58 . Additional information in regards to financial services offers is reached when including the Popular Saving and Loan Institutions (PSLI) in the analysis.1 the classification of institutions offering financial services is shown: Commercial Bank. Among the category of Cooperatives B B the Credit Union or Savings and Loans Cooperative Societies are included. at the end. Credit Unions and Financing Societies with a Limited Object (SOFOLES). In table 3. state and municipality level. 2. in transition. the CNBV is actually elaborating a database to identify them and support their inclusion in the regulation system. as well as the banking system (Commercial Bank and Development Banks). semi-urban. State-owned Bank. Table 3. for example: 1. Municipalities are defined into six categories: rural. this means. and for Microfinance we refer to Popular Financial Societies (SOFIPOS). In the case of Non-Regulated Institutions. Indicators were obtained according to the regions defined in the National Plan for Development. the Non-Regulated Institutions. The delegations of the Mexico City have been analyzed apart from other categories to avoid any overestimations. Together with the geographical and demographical indicators at a national. Savings and Popular Credit Entities (divided into Cooperatives and Microfinance) and. 3. Also the EACP are presented as in the following division: Cooperatives and Microfinance37.This second report of financial inclusion adds analysis levels to the infrastructure described in the first report. 5.

77 due to the incorporation of PSLI (see graph 3.3). which is not true for the point of sale terminals. included only at the CD-ROM. Geographical and demographic indicators Demographic indicators39 per 10. the municipalities that provide the service.37 to 1. Microfinance was composed by 137 Credit Unions. Demographic indicators give us an approach of the average of people attended by some contact point (see Table 3. The total amount of regulated institutions in the country is 285. 38 Only Bansefi and Banjército are considered in this category as these have offices for attending the general population.59 In graph 3.4) and the more than 300 offices of service provided by Compartamos Banco. the indicator presents a marginal increase. Table 3. as the indicator decreases. the State-owned Bank and the PSLI. 2010).2 we can observe the number of institution belonging to each category. 39 Demographic indicators at a municipality level are shown in Annex 7. The demographic indicator of branches increases considerably as it goes from 1.000 km2 consider the Commercial Bank.000 adults and geographical by 1. as well as the data related to adults in the possibility of accessing each type of institution. and it continues with indicators for the total amount of branches. In the case of ATMs. 16 SOFOLES and 32 SOFIPOS.2 Number of institutions in each category 185 57 41 2 Commercial Banks State-owned Banks2 Cooperatives Micro Financing Source: CNBV38 Indicators on a national level This section analyses demographic and geographic indicators of the different channels or contact points. . When this report was closed (data from March.

07 Micro Financing Cooperatives 1.000 adults 1.4 shows the demographic indicator disaggregated into the different types of institution.Table 3.4 Branches per 10.47 State-owned Banks Commercial Banks Jun.10 0.31 1.77 1. 10 Source: CNBV 60 . Graph 3.13 0.06 0. 09 Mar.3 Geographic and demographic indicators Source: CNBV Graph 3.37 0.

the amount of municipalities without presence of any financing institution is still significant.61 Access points Taking into account only the number of access points. however. .5 shows the number of points per each institution category.5 Total number of access points by type of institution 768 1. which holds up to 83% of all branches in the country. In map 3. Municipalities on a gray color show that there are Commercial Bank branches as well as State-owned Bank ones. All together. being the Cooperatives those with a greater presence at a national level after the Commercial Bank. Graph 3. it can be seen how the PSLI complements certain municipalities with no Commercial Bank presence.029 548 13. there are in Mexico 13.235 Coomercial Banks State-owned Banks Cooperatives Micro Financing Total Regulated Institutions Source: CNBV The following maps show the presence of branches in country municipalities.580 offering financial services.580 11. Municipalities in a mid gray tone show that there are only branches of Popular Savings and Loan Institutions and in a dark gray color the municipalities that have the three types of institutions. Graph 3.7. the PSLI represent 13% of the total Regulated Financial Institutions.

7 Presence of access points in the Center region of the country Ranking Only CB and SB (449 municipios) Only PSLI (114 municipios) CB + SB + PSLI (489 municipios) Without branches(1.6 Presence of access points Ranking Only CB and SB (449 municipios) Only PSLI (114 municipios) CB + SB + PSLI (489 municipios) Without branches(1.Map 3.404 municipios) Source: CNBV 62 .404 municipios) Source: CNBV Map 3.

052 municipalities of the country (43% of the total) are covered.3% of municipalities. Cooperatives are present in 18. The Commercial Bank for example. Coming in second.0% 0.0% Number of municipalities 700 600 500 802 Percentage of municipalities 25. Graph 3.0% 18.8 Municipalities with presence of some branch per sector 900 800 32.63 Municipalities with access points Graph 3. at least.0% 15. 1.3% 450 12. one branch of any kind of financial institution.7% 35.8 shows the number of municipalities that have. Taking into account all institutions with regulated financial services. is in 802 municipalities being the sector with 32.0% 5.0% 17.7% 20.0% 400 417 300 200 311 100 0 Commercial Banks State-owned Banks Source: CNBV Cooperatives Micro Financing .0% 30.0% 10.7% of the total municipalities of the country.

the average of adults living in the municipalities with the presence of financial institutions is 90%.5 Commercial Bank State-owned Bank Cooperatives Micro Financing Source: CNBV Adults with possibility of access In spite of the fact that 57% of the municipalities (1. for example. 64 . which is nearly one branch per municipality.9 we can see how the Commercial Bank has an average of 14 branches in each municipality where it is located. this is the concentration of these in municipalities with presence. Graph 3. which indicates a greater coverage due to its number of branches. has 548 branches located in 417 municipalities.10 shows the percentage of adults living in a municipality with a branch per type of institution. The Sate-owned Bank. Graph 3.9 Average of branches per municipality per sector 14.404) do not count with presence of any kind of branch. In graph 3. far above from other institutions.3 1.0 2. they have access to the financial system.It is important to observe the distribution of branches in municipalities.3 2. in other words.

65 Graph 3. the South-Southeast region has the lowest level of indicators. On the contrary.7% 66. . In the case of branches.6% 65.31 branches per 10.10 Percentage of adults living in municipalities with branches per sector 85.6% 53.11 that such region is the only one below the national average with 1.09 branches. the Northeast region has the highest indicator with 2.1% Commercial Bank State-owned Bank Cooperatives Micro Financing Source: CNBV Indicators at a regional level Among the five regions of the country. it can be seen in graph 3.000 adults.

09 1.4% 52.77 1.7% 50.84 2.11 Amount of branches per every 10.2% Center Central-Western Northeast Northwest South-Southeast Source: CNBV 66 .9% 27.86 National Average = 1.02 1.Graph 3. the centralwestern region has a greater percentage compared with other regions.000 adults 2.12 Percentage of municipalities with branches 72.31 Center Central-Western Northeast Northwest South-Southeast Source: CNBV In regards to the total number of municipalities with the presence of any branch. The South-Southeast region shows the lowest indicator.8% 57. mainly due to the fact that Oaxaca has 25% of the total municipalities of the country (570 in total) Graph 3. reaching 73% of municipalities with coverage.0% National Average = 42.

as 56% of the branches are located in this region. it can be seen that the Northeast region has a greater proportion of the Commercial Bank. Microfinance represents a greater percentage in the South-Southeast region.13 Adults with possibility of access 94% 94% 95% 98% National Average = 90% 76% Center Central-Western Northeast Northwest South-Southeast Source: CNBV When dividing branches per region and per type of financial institution. Graph 3. At the Central-Western region there is a greater presence of Cooperatives. with the exception of the South-Southeast region with 76% of the total of adults. Finally. The State-owned Bank has more branches and a greater presence at the South-Southeast region.67 Adults living in municipalities with presence of any kind of branch are above 94% in all regions. . Graph 3. 32% Commercial Bank branches and 34% Microfinance ones are located in the Central region. in comparison with other types of branches in the region.14 shows the distribution of branches in each region.

this is due to the incorporation of PSLI with a greater weight on this state. which is the state with the highest indicator related to the population of the entity and below this state is Colima. but some changes in other states are observed as in the case of Oaxaca.15 the demographic indicators per branches per 10. as it is one of the states with fewer adults overall. Tlaxcala is positioned as one of the states with fewer branches per 10.14 Distribution of branches per region 100% = 4.201 5% 18% 2. Quintana Roo and Baja California Sur show higher indicators than the national average and part of this is due to the high commercial and touristic activity that can be found in both states. Quite surprising are the conditions of Puebla. At the end of March 2010. Estado de México and Hidalgo.000 adults.143 3. which even if located in the Central region. slightly above Chiapas. On the other hand.760 6% 3% 4% 7% 8% 7% 4% 87% 73% 90% 92% 78% Center Commercial Bank Central-Western Northeast Northwest South-Southeast State-owned Bank Cooperatives Micro Financing Source: CNBV Indicators at a State level In Table 3. it can be seen that Chiapas is again last place on the list. which improves its position at the ranking.Graph 3. The opposite situation is the case of Nuevo León. show very low indicators when compared with other states of this same region.000 adults are shown.196 4% 2% 2% 2.280 4% 5% 2% 1. Regarding ATMs and point of sale terminals. 68 .

6 85.077.2 52.000 adults State Nuevo León Colima Distrito Federal Querétaro Baja California Sur Jalisco Guanajuato Sonora Coahuila Sinaloa Quintana Roo Tamaulipas Morelos Chihuahua Michoacán Campeche Baja California Aguascalientes Nayarit Yucatán San Luis Potosí Tabasco Zacatecas México Puebla Hidalgo Durango Veracruz Oaxaca Guerrero Tlaxcala Chiapas NACIONAL NACIONAL SIN DF Adult Population 3.286 1.921 69.69 9.86 1.81 2.68 6.910 5.825 692.6 32.67 1.34 1.314 2.180 2.15 3.77 1.38 2.311.107.416 947.68 1.23 1.55 5.6 143.8 113.715 Branches 2.02 7.6 31.63 2.20 1.923 439.03 1.816 2.65 5.2 77.9 81.92 1.469.77 4.2 40.96 3.15 Demographic indicators by federal entity branches.246.26 1.765 1.706.39 1.797.900 5.778.23 5.445.7 57.76 4.29 9.4 47.5 36.69 2.718.69 2.1 67.9 34.66 1.80 2.30 1.73 3.538 411.58 1.9 57.41 1.46 3.9 58.79 1.43 2.90 2.790.90 8.35 1.6 42.68 4.1 43.17 1.81 Branches Ranking 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 ATMs 9.3 142.281 1.16 6.60 1.21 5.84 1.34 1.01 2.2 78.910 max 10.01 1.2 41.715 3.6 73.315 76.272 1.85 1.087 6.96 1.71 4.912.6 64.74 2.678.714 2.06 1.867.71 2.7 52.7 48.64 1.517 2.6 56.539 1.897.764 789.2 20.8 23.0 58.7 36.97 2.9 143.242 1.94 2.04 3.454.435 781.656.2 POS Ranking 4 7 3 6 1 8 17 10 9 11 2 13 15 14 22 18 16 5 19 12 21 24 28 23 25 29 20 26 31 27 30 32 Source: CNBV and CONAPO . ATMs and POS per 10.572 962.294.397.9 59.46 6.888.689 2.5 25.14 5.217 1.427.32 1.8 35.94 3.200.082 10.005.53 4.55 2.1 20.38 1.873 1.69 Table 3.20 6.938 567.215.293 2.20 ATMs Ranking 2 10 3 8 4 13 21 11 5 15 1 6 16 9 27 14 7 12 17 20 19 18 28 24 29 25 23 22 32 26 30 31 POS 101.649 min 411.656.213.31 1.995.76 3.344 3.82 1.987 1.89 1.172 1.

85 1.80 2.90 5.23 Colima Distrito Federal Distrito Federal Querétaro 2.89 Chihuahua 5.06 3.67 1.38 2.60 1.20 Quintana Roo Nuevo León 2.96 Baja California 6.74 Aguascalientes Nayarit Yucatán San Luis Potosí 1.29 Jalisco Morelos Chihuahua Michoacán Campeche 1.03 Oaxaca 1.41 1.77 1.63 2.92 1.82 1.14 8.66 1.77 Nayarit 3.96 2.34 1.46 5.69 2.35 1.02 5.84 Aguascalientes 5.01 .31 Michoacán Zacatecas Veracruz Oaxaca Guerrero 1.20 Tlaxcala Chiapas Tlaxcala Chiapas 1.76 6.81 2.71 2.26 1.71 Nuevo León 9.46 4.55 2.32 1.65 3.39 a) Branches per 10.58 Yucatán b) ATMs per 10.43 Baja California Sur 6.70 9.30 Puebla 1.34 Hidalgo Guerrero 2.69 Hidalgo Durango 1.15 4.90 Guanajuato Querétaro Sonora Coahuila 1.16 Position of the states by access point México 1.000 adults Veracruz Durango Zacatecas México Puebla 1.23 1.64 National Average 1.76 3.55 6.16 7.38 Table 3.73 3.94 Tabasco 3.21 Morelos Campeche Baja California 1.04 2.68 Coahuila Baja California Sur Tamaulipas Jalisco 2.000 adults Guanajuato San Luis Potosí Tabasco 1.94 3.97 2.53 Sinaloa 4.79 National Average 4.86 1.68 Colima Sinaloa Sonora Quintana Roo Tamaulipas 1.

Chihuahua Chiapas Colima Nayarit Oaxaca Sonora Sinaloa Puebla 21 .7 114 101 85 82 79 77 74 68 64 60 59 58 57 57 52 49 48 44 43 42 41 37 37 36 34 32 31 25 24 Jalisco Querétaro Durango Tabasco Zacatecas Yucatán Veracruz Hidalgo México San Luis Potosí Aguascalientes Distrito Federal Guanajuato Michoacán Campeche Guerrero Quintana Roo Tlaxcala Tamaulipas Coahuila Morelos Baja California Nuevo León Baja California Sur Source: CNBV To analyze in greater detail the impact of each type of institution in the demographic indicator. the number of branches per 10.000 adults 143 143 Media Nacional 57. It is important to point out that Colima is the state with the highest indicator in Cooperatives as its general indicator increases importantly.17.71 c) Points of sale per 10. in table 3. In the case of Microfinance. Querétaro is the first state and Chiapas also obtains a noticeable indicator with a third place position on a national level.000 adults is disaggregated.

10 0.32 1.92 1.05 0.11 0.07 0.08 0.07 0. 72 .01 0.12 0.84 0.09 0.02 0.81 2.39 1.61 1.10 0.01 0.25 0.47 1.09 0.96 1.12 0.01 1.56 1.08 0.09 0.50 0.66 1.10 0.72 1.02 0.21 1.06 0.03 1.44 0.31 1.72 2.02 0.10 0. as it has 310 branches and shows the highest indicator in terms of Microfinance.38 2.19 0.05 0.Table 3. it can be seen that Cooperatives also play a relevant role as the value of this indicator is explained by the 24% per the number of Cooperatives in this state. The particular situation of Querétaro can be highlighted.06 0. and therefore.07 0.04 0.04 0.41 1.03 0.09 0.81 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 Source: CNBV To analyze in greater detail the importance of institutions in some states.04 0.09 0.13 0.61 1 6 2 14 3 4 15 5 8 7 10 9 12 13 17 19 11 16 18 22 26 20 28 21 23 25 24 27 31 29 30 32 0.20 1.04 0.18 1.03 0.20 1.15 0.13 0.89 1.04 0.05 0.13 0.17 0.10 0.07 0.55 2.44 23 10 8 1 4 14 2 7 15 25 24 29 19 5 20 9 30 6 28 17 11 13 31 18 16 21 26 12 27 32 22 3 2.02 0.14 0.26 1.56 0.64 1.69 1.38 1.80 2.09 0.22 0.15 0.84 1.27 0.05 0.07 0.01 0.14 31 4 9 18 24 22 23 25 32 26 21 17 11 30 3 6 29 27 16 10 15 20 2 19 13 5 28 7 1 14 12 8 0.58 1.17 Number of branches per 10.11 0.82 1.12 0.07 0.00 0.16 1.11 0.85 0.04 1.00 0.01 2.02 0.03 0.08 0.60 1.08 0. its indicator is explained in 17% due to this type of institution.35 1.11 0.15 0.14 0.54 2.19 0.09 0.09 0.84 17 1 28 3 25 5 2 27 15 20 14 23 16 19 4 8 32 12 7 9 11 26 10 30 24 22 13 21 6 18 29 31 0.61 1.20 1. In Oaxaca.04 0.000 adults) Estado Commercial Bank Ranking State-owned Bank Ranking Cooperatives Ranking Micro Financing Ranking Total Indicador Ranking Nuevo León Colima Distrito Federal Querétaro Baja California Sur Jalisco Guanajuato Sonora Coahuila Sinaloa Quintana Roo Tamaulipas Morelos Chihuahua Michoacán Campeche Baja California Aguascalientes Nayarit Yucatán San Luis Potosí Tabasco Zacatecas México Puebla Hidalgo Durango Veracruz Oaxaca Guerrero Tlaxcala Chiapas NACIONAL NACIONAL SIN DF min max 2.12 0.09 1.10 0.73 2.67 1.71 2.29 1.79 1.11 0.01 0.07 1.85 1.21 0.30 0.000 adults per type of institution Demographic indicator (branches per 10.44 1.01 0.55 1.11 1.05 0.09 0.06 0.07 0.13 0.43 2.05 0.71 1.19 0.76 1.03 0.69 1.86 1.10 0.68 1.37 0.09 0.23 1.61 1. Colima has 123 branches of which 30% are Cooperatives and due to this fact it obtains the second place in relation to this indicator.47 1.09 0.08 0.08 0.77 1.06 0.78 1.33 0.05 0.02 0.07 0. we have selected some examples.03 1.30 1.17 0.34 1.20 1.05 0.36 0.90 1.06 0.01 0.01 0.10 0.23 1.09 0.04 0.

4% Aguascalientes 8.1% Guanajuato 24.5% Guerrero 0.6% Querétaro 60.8% Source: CNBV .9% Tamaulipas 91.73 Table 3.6% States with the lowest presence Baja California 1.1% Nuevo León 0.3% States with the lowest presence Colima 61.18 Examples of distribution of branches per type of institutions 100% = 382 2% 0% 2% 911 3% 4% 1% 123 4% 310 4% 310 17% 30% 24% 20% 4% 11% 3% 97% 93% 62% 62% 60% Baja California Nuevo León Colima Oaxaca Cooperatives Querétaro Micro Financing Commercial Bank State-owned Bank Source: CNBV As a way of summarizing.5% Zacatecas 9.8% Cooperatives States with the higher presence Colima 30.9% States with the lowest presence Chiapas 0. Table 3.9% Nuevo León 92.9% Oaxaca 23. on the other hand.0% Micro Financing States with the higher presence Chiapas 18.6% Zacatecas 1. It can be seen that in Colima 30% of the branches are Cooperatives and.7% Distrito Federal 0.5% Baja California 0.19 shows the federal entities with the highest and lowest number of institutions in each category.8% Oaxaca 61.4% Coahuila 1.4% Querétaro 17.3% State-owned Bank States with the higher presence Oaxaca 11. table 3.0% States with the lowest presence Chihuahua 1.0% Chiapas 9. Baja California has no presence of such institutions.19 States with the highest and lowest presence of institutions Commercial Bank States with the higher presence Baja California 96.

we only used two categories: rural and urban. this is. Yucatán.20 Percentage of municipalities with at least one branch 100% 90% 80% 70% 60% 50% 40% National Average 42. 74 Tlaxcala Hidalgo Oaxaca Sinaloa Sonora Colima Jalisco . graph 3.000 inhabitants40. Puebla.20 shows the percentage of municipalities with at least one branch per each federal entity. we will show demographic indicators per type of municipality and after the “presence indicators”. States with fewer municipalities covered are Oaxaca. With this classification. Table 3. The first category considers those municipalities with less than 50.9% 30% 20% 10% 0% Guanajuato Querétaro Puebla San Luis Potosí Guerrero Veracruz Durango Distrito Federal Aguascalientes Michoacán Nuevo León Chihuahua Campeche Coahuila Nayarit México Quintana Roo Morelos Tamaulipas Zacatecas Baja California Sur Baja California Tabasco Yucatán Chiapas Source: CNBV Indicators at a municipality level For this section.000. the number of contact points. we will keep using the classification of municipalities which was used in the previous report.Also. to simplify the process. In some cases. while the second category includes those greater than 50. Tlaxcala and Sonora. the amount of municipalities with branch presence and the amount of adults with access possibilities. as it favors the analysis when comparing municipalities of similar sizes.

01 0. Cooperatives have greater participation in the demographic indicator with 61%.13 2.001 1.59 and the metropolis municipalities with 2.000 5.07 0.10 0.13 0.09 2.47 0.04 0.001 300. Such analysis can be seen in table 3.13 1. the Commercial Bank’s presence increases considerably until reaching 90% in the metropolis and 91% in Mexico City. However.59 100% In transition Semi-urbans 0.000 > 1.000 15.03 0.41 56% 0.00 87% 2% 6% 5% 100% Metropolis 2.74 0. there is an important difference between rural municipalities with an indicator of 0.09 0.21 Classification of municipalities per inhabitants range Clasificación Rural Tipo de municipio Rural In transition Semi-urban Urban Semi-metropolis Metropolis Rango de habitantes 0 5.000.22. Table 3.47 0.000 adults 1.75 Table 3.001 15.08 0.03 0.15 26% 0.001 50.01 1% 0.22 Number of branches per 10.02 64% 12% 17% 7% 100% Urbans 1.16 0.71 DF 91% 3% 1% 5% 100% Source: CNBV 40 Criteria used by the Development Bank.03 4% 0.38 0.10 1.73 100% 0. In rural municipalities.36 61% 0.12 0.001 Urbano Source: CNBV Demographic access indicator (branches) It is possible to see that as the size of the municipality increases.000.26 90% 1% 5% 4% 100% 2.66 0.000 adults Classification of municipalities Institutions Commercial Bank State-owned Bank Cooperatives Micro Financing Indicador Branches per 10.77 83% 4% 8% 6% 100% Rural 0. .26.11 2.19 25% 0.13 18% 0.07 1.11 0.000 300.05 9% 0.74 79% 4% 9% 7% 100% Semimetropolis 1.18 0.000 50.

16 0.59 0.41 0.36 0.03 2. It can be observed that in rural municipalities the participation of Cooperatives is much greater than that of the Commercial Bank.23 the composition of branch indicators classified per type of institution and type of municipality is shown.In graph 3.13 0.47 0.74 2.11 0.38 0. The Commercial Bank has a greater presence in bigger municipalities. It is also evident that the Stateowned Bank has a better position at transition and semi-urban municipalities.12 1.04 2.07 0.08 2.01 0.13 0. Table 3.02 0.03 0.74 0.71 0.18 0.15 Rural In transition Semi-urbans Urbans Semi-metropolis Metropolis DF Commercial Bank State-owned Bank Cooperatives Micro Financing Source: CNBV 76 .73 0.10 0.13 1.26 0.05 0.23 Composition of indicators by type of institution 100% = 0.03 2.01 0.66 1.09 0.19 1.11 0.09 0.00 0.

It can be seen that the Microfinance branches are distributed along all types of municipalities.25 shows the percentage of municipalities with the presence of branches per type of institution and per municipal category. Table 3.25 Percentage of municipalities with branches per category and per type of institution Classification of municipalities Institutions Total municipalities Commercial Bank State-owned Bank Cooperatives Micro Financing Total Municipalities with access 2.24.456 802 33% 417 17% 450 18% 311 13% 1.235 State-owned Bank 548 Cooperatives 1.910 90% 29 1% 97 5% 84 4% 2.24 Number of access points Classification of municipalities Institutions Access points 83% 4% 8% 6% 100% Rural 18 26% 6 9% 43 61% 3 4% 70 100% In transition Semi-urbans 179 56% 56 18% 81 25% 4 1% 320 100% 796 64% 143 12% 216 17% 85 7% 1.029 Micro Financing 768 Total 13.118 79% 170 4% 360 9% 284 7% 3.580 Source: CNBV Municipalities with Regulated Financial Institutions (IFR) Table 3. the distribution of the 13.932 100% Semimetropolis 3.120 100% DF 1.865 100% Commercial Bank 11. It is interesting to note the presence of Cooperatives at rural municipalities.240 100% Urbans 3. Table 3.033 100% Metropolis 1.052 43% Rural 732 15 2% 6 1% 35 5% 3 0% 55 8% In transition Semi-urbans 678 107 16% 56 8% 72 11% 4 1% 193 28% 662 315 48% 143 22% 150 23% 74 11% 431 65% Urbans 309 290 94% 145 47% 146 47% 158 51% 298 96% Semimetropolis 50 50 100% 43 86% 33 66% 47 94% 50 100% Metropolis 9 9 9 7 9 9 DF 16 16 100% 15 94% 7 44% 16 100% 16 100% 100% 100% 78% 100% 100% Source: CNBV .701 91% 65 3% 10 1% 89 5% 1. with a better position at urban and semi-metropolis. covering 5% which it equivalent to 35 municipalities.513 87% 79 2% 222 6% 219 5% 4.77 Number of access points In terms of number of branches or contact points.580 branches is shown in table 3.

In table 3.26 Percentage of coverage of branches per type of municipality 96% 100% 100% 100% 65% 28% 8% Rural In transition Semi-urbans Urbans Semi-metropolis Metropolis DF Source: CNBV It is important to point out that there are 11 urban municipalities with no branches at the end of March 2010. as can be seen in graph 3. as is the case of the municipality of Chilón in Chiapas with 100.000 inhabitants and that only has four point of sale terminals. 78 .000 inhabitants.27. the complete listing of such municipalities can be seen.26. the percentage of municipalities with branches is above 96%. 28% of transition municipalities have at least one branch of IFR and at the semi-urban municipalities the coverage of branches is of 69%.Only 8% of rural municipalities are covered by some sort of institution which offers financial services. From the urban category. Table 3. Such municipalities have more than 50.

nearly every adult can access a financial service. In Mexico there are 76.27 Urban municipalities without branches (greater than 50. From urban municipalities. first the municipalities with presence of branches of any institution are considered and then the number of adults living in those municipalities is obtained.068 55.7 million adults.605 38.405 Adult population 42.604 33. .178 109.000 inhabitants) State Chiapas Chiapas Chiapas Chiapas Chihuahua México Morelos Puebla Sonora Veracruz Yucatán Municipality Chamula Chilón Salto de Agua Tila Guadalupe Y Calvo San José del Rincón Ayala Acajete Etchojoa Ixhuatlán de Madero Kanasín Population 72.552 Branches 0 0 0 0 0 0 0 0 0 0 0 ATMs 0 0 0 0 0 1 0 1 1 0 3 POS 0 4 6 2 14 0 16 9 18 0 57 Source: CNBV Adults with access possibility In order to estimate the number of adults with access possibility.897 62.013 35.776 32. In this way we are able to determine the number of adults that can access financial services.077 48.195 40.28).79 Table 3.370 70.525 66.596 61.819 88. At the rural municipalities it can be observed that only 11% of the adults have the chance of accessing a branch.948 53. In transition municipalities there are 68% of adults with no access to financial institutions.402 57.179 55. as the presence of a branch of a Regulated Institution eases the access.426 51. 10% of them has no possibility to access financial services (see table 3.378 34.184 50.132 42.

2 95% 20.1 70% 19.1 98% Semimetropolis 20.6 86% 50.3 66% 41.2 90% 14.6 90% Rural 1.9 100% 6.4 100% 100% 77% 100% 100% DF 6.9 100% 9.7 56% 12.2 61% 6.7 65.4 7.14 11% In transition 0.2 100% 18.9 24% 2.4 9.6 71% Urbans 22. the CNBV made a list and gathered information on the different organizations willing to establish business models of banking agents. the information available in December 2009 was taken and this refers to the location of stores/points of support of such banking agents in a municipality level and it was integrated to the database of branches.28 Total in the country with access possibility (million of adults) Classification of municipalities Institutions Total municipalities Commercial Bank State-owned Bank Cooperatives Micro Financing Total Municipalities with access 76. The Federal Government is committed to promote such a new figure.7 14% 8.4 9. 80 . the new regulation on banking agents will allow widening the potential of financial institutions to offer services and products via new distribution channels.8 0.9 6. mainly business models executed by the banking institutions.4 0.2 100% Metropolis 9.2 54% 50.4 18% 10% 12% 1% 32% Semiurbans 12.2 0.1 6. With this new regulation a considerable increase in access points to financial services is expected.02 1% 0. In order to develop a preliminary exercise of the potential impact on the access to financial services.5 0.7 98% 4.6 54% 2.9 100% 6.01 1% 0.0 1.1 54% 13.2 9.2 20.8 97% 12.5 60% 22. Expected impact Until this month of March. All the organizations are grouped into five categories.4 4.Table 3.6 21. we can see the impact they will have in a medium term.9 24% 1. however.7 66% 68. three of them directly related to the government: 1) 2) 3) 4) 5) Self-service stores with big surfaces: supermarkets Convenience stores: small stores and pharmacies Telecomm Diconsa41 Gas Stations 41 Only 25% of their stores are considered.08 7% 0. as not all stores have nowadays the infrastructure required to operate as banking agents. its success relies in several factors.04 4% 0. Therefore.4 Source: CNBV The impact of banking agents in access As seen in chapter one.

000 802 800 33% 600 417 400 200 Commercial State-owned Bank Bank PSLI Self-service Convenience Telecomm stores with stores big surfaces Diconsa Gas Stations 38% 603 405 536 615 43% 43% 46% 1. namely. it is clear that adding such access points of banking agents together with the branches could amount to more than 40. as their presence in most of the municipalities of the country is higher. 42. the State-owned Bank and the PSLI add up to 13.384 90% 80% Number of municipalities 1. the number of potential municipalities with a point of contact could increase up to 80%. if this is added to potential banking agents. considering the Commercial Bank. Table 3.400 1.29. Diconsa and the Gas Stations can be observed.000 (see graph 3. as well as the State regulated networks.169 67% 75% 80% Percentage of municipalities 70% 60% 50% 40% 30% 20% 10% 0% Municipalities with access Cummulative percentage of municipalities with access Source: CNBV It can be seen that the access points. convenience stores and supermarkets.200 1. With the new banking agents.29 Potential impact of banking agents 1. . The impact of State regulated networks as Telecomm.8% of municipalities have branch presence of some kind of institution.30). the potential impact of these five categories of banking agents can be appreciated.600 1.580 access points.81 In graph 3. Taking into account the actual financing institutions.

and also the municipalities with the presence of banking agents and the number of adults with access possibilities. among them.30 Impact of banking agents – attention points 17. the contact points could be observed.580 11.191 13. 82 . among others.072 Financial institutions Self-service and convenience stores State regulated networks Source: CNBV On the Third Report of Financial Inclusion the first indicators of banking agents will be included (with information of regulatory reports).Table 3.

In this chapter only the Multiple Banking and the Development Banking will be considered because in the case of the Popular Savings and Loan Institutions (EACP. .83 USAGE INDICATORS The indicators of use allow us to know the demand of financial services. All the information has been taken from the regulatory reports that are sent to the CNBV by the financial institutions with numbers from March of 2010. as in the Mexican abbreviation) we find ourselves still in the process of integrating the indicators at municipal level. thanks to them we can observe which products are the ones that are used the most and in which areas they are offered.

In the first part of the chapter. the debit card is the representative product and on this the analysis will be developed in the present chapter. with 720 cards per each 1. some indicators of municipal credit related to the population are presented. a more detailed study is presented on the access and use of the different products. payroll accounts. secure deposits and debit cards. Presented at the end of the section is an analysis made with information provided by the Bank of Mexico of the flow of family remittances and it concludes with a revision about the use of Internet. Chart 4. National indicators In the chart 4. and 2) credit: credit cards. both in rural as in transition municipalities. 84 . the usage indicators are divided in two: 1) income: checking accounts. Below. state and municipal levels42.000 adults. savings accounts. this chapter will include information generally related to the transactions made with debit and credit cards in ATMs and point of sale terminals. regional. For the credit indicators the credit cards will be used as the representative product. In the case of the EACP.Products of acquisition and credit In the same way that the previous report was presented.000 adults 720 413 346 353 307 44 Checking accounts Saving accounts Payroll accounts Term Deposits Debit card Credit card Source: CNBV 42 Within the state analysis will analyze the relationship between the presence of financial infrastructure and use of certain products. the indicators for the acquisition and credit products are represented at national. Additionally. this represents an increase of 10% compared to June of 2009 in which this same indicator was 652. In regards to the acquisition accounts.1 Numbers of contracts per each 1.1 we observe the summary of the demographic indicators where the credit card product is the one that is used the most.

2 Number of contracts per 1.000 adults. the same does not apply with debit cards.85 In regards to the credit cards.2). In the following sections we can see in more detail (in state and municipal levels) the differences in regards to the first report published in June 2009. which are better distributed within the regions (see graph 4. which represents a decrease of 12% from June 2009. Chart 4. increasing the regional average by 688 cards.000 adults Debit card 834 682 522 861 815 National Average = 720 Center Central-West Northeast Northwest South-Southeast Credit card 688 National Average = 307 212 168 166 96 Center Central-West Northeast Northwest South-Southeast Source: CNBV . which has an indicator of more than 2. Regional indicators The regional analysis shows us a clear concentration of credit cards in the center of the country influenced principally by Mexico City.000 credit cards per adult. However. the demographic indicator adds up to 307 cards per 1.

the credit cards are used the most. in the Center region. In other words. In the case of debit cards. a similar use is seen in most of the regions except the central region. Graph 4. 86 . the Central region has the highest credit card usage compared to other regions due to the influence of Mexico City. in the West-Central region time deposits stand out and.If we analyze the totality of income products and credit cards we can observe how these are distributed within each region. For example. The South-Southeast region has the highest number of savings accounts per 1.000 adults compared to the rest.3 Numbers of contracts per 1. In the Northeast. payroll accounts prevail. while in the North checking accounts are the most used products. in the South savings accounts prevail.000 adults 9% 9% 7% 7% 24% 36% 29% 3% 2% 17% 15% 13% Center 18% 16% Central-Western Checking accounts Term Deposits Source: CNBV 36% 2% 23% 14% 16% Northeast Saving accounts Debit card 36% 1% 22% 12% 22% Northwest Payroll accounts Credit card 36% 2% 18% 20% 17% South-Souteast 19% The following table shows how in each region a different financial product prevails.

The information at state level of other income products can be consulted in Annex 3. Campeche and Colima by more than 50%. Table 4. decrease their numbers of credit cards. all the other states. possibly due to a reduction in credit and an improvement in quality information. In all of the other states. respectively.5 shows representative income and credit indicators per 1. When compared to the information of the first report. . Tlaxcala is the only state in the country whose number of debit cards decreases by 8% in the time period mentioned.Southeast Northwest Northeast Central-West Center Source: CNBV Product Saving accounts Checking accounts Payroll accounts Term Deposits Credit cards State indicators Table 4. and are compared to the information presented in the first report. states like Oaxaca and Baja California Sur increase their indicator in 5% and 24%.5 also presents the ranking for the debit card and for the credit card and is ordered by highest to lowest according to the number of debit cards. by 35%. except Mexico City. specifically in states like Nayarit.4 Products with the most use in each region Region South.000 adults in the federal entities. In regards to credit cards. and in spite of the 12% reduction at national level. particularly Aguascalientes.87 Chart 4. Nuevo Leon and Aguascalientes. which shows numbers up to June 2009. On the other hand. the numbers increase. we can emphasize some cases that seem relevant to us: for example. 25% and 19% respectively.

000 adults Captación por ca da 1.394 892 811 848 822 822 768 752 764 720 700 748 717 673 675 666 598 560 576 585 503 507 481 463 486 501 420 430 431 436 480 337 652 527 Tarjeta de débito Mar.Chart 4.009 245 134 165 194 113 145 318 182 183 198 122 208 131 153 249 187 126 143 104 107 106 129 100 124 60 68 106 114 113 65 61 307 139 Variación 2% -30% -13% -57% 24% -19% -17% -39% -7% -3% -11% -44% -23% -70% -18% -53% -40% -20% -14% -30% -20% -26% -13% -17% -39% -33% -41% -3% -24% -41% -11% 5% -12% -19% TDD TDC Distrito Federal Nuevo León Nayarit Aguascalientes Baja California Sur Tabasco Quintana Roo Coahuila Tamaulipas Sinaloa Sonora Baja California Jalisco Campeche Chihuahua Colima Guanajuato Querétaro Morelos Zacatecas San Luis Potosí Hidalgo Michoacán México Durango Guerrero Chiapas Puebla Veracruz Yucatán Tlaxcala Oaxaca NACIONAL NACIONAL sin DF Source: CNBV 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 1 4 15 11 7 23 13 2 10 9 6 20 5 16 12 3 8 18 14 27 24 26 17 28 19 32 29 25 21 22 30 31 88 . 10 1.973 352 154 386 157 139 176 520 195 188 221 218 270 440 185 531 309 157 166 149 133 144 147 121 205 90 116 109 151 192 73 58 349 172 Tarjeta de crédito Mar.515 1.000 a dul tos Ranking Estado Jun.094 1. 09 1. 09 1.5 Number of contracts of credit cards and debit cards per 1. 10 2.118 1.000 a dul tos Crédito por ca da 1.007 876 865 849 837 834 833 801 801 745 733 714 709 634 603 599 598 553 548 538 522 522 516 485 479 474 471 443 398 720 641 Variación 9% 25% 35% 19% 7% 5% 10% 11% 9% 16% 14% 7% 4% 9% 6% 7% 6% 8% 4% 2% 10% 8% 12% 13% 7% 3% 15% 11% 10% 8% -8% 18% 10% 22% Jun.

Oaxaca.6 Percentage of municipalities with debit cards 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% National Average 38.89 States like Baja California. Sinaloa and Tabasco has records of debit card contracts in 100% of its municipalities. the average of municipalities with use of credit card is superior.4% 0% Tamaulipas Guanajuato Zacatecas Baja California Aguascalientes Campeche Baja California Sur Distrito Federal Michoacán Durango Tabasco Veracruz Tlaxcala Yucatán Hidalgo Jalisco México Nayarit Guerrero San Luis Potosí Total general Querétaro Chiapas Quintana Roo Source: CNBV Nuevo León Chihuahua Coahuila Morelos Oaxaca Sinaloa Colima Sonora Puebla . the behavior is very similar in regards to the coverage of municipalities by states. Table 4. reaching 65% from the total number of municipalities in the country. Yucatan. unlike the debit card. but.7 show the percentage of municipalities in which debit and credit cards are used. Baja California Sur. On the other hand. Mexico City.6 and 4. Chart 4. states like Sonora. Puebla and Tlaxcala record cards in less than 30% of their municipalities. In the case of credit cards.

7. the use of the products is very limited.7 Percentage of municipalities with credit cards 100% 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Aguascalientes Tabasco Promedio Nacional 65% Hidalgo Jalisco Guerrero Tlaxcala Nayarit Sinaloa Tamaulipas Guanajuato Zacatecas Baja California Quintana Roo Baja California Sur Distrito Federal Total general Querétaro Yucatán Coahuila Morelos Nuevo León Campeche Michoacán Durango Chiapas México Veracruz San Luis Potosí Source: CNBV Correlation between number of branches and ATMs with the use of products In graph 4. Because of this.Chart 4. for example. As it is shown in graph 4. the correlation between different numbers and the number of branches and ATMs is clearly positive. the number of debit cards and the number of ATMs present a positive correlation of 69%. As a result of this analysis we observe that the “distance” barrier can affect the use of financial products because. which indicates that the greater the number of branches. the greater the number of credit cards distributed. In the same manner. 90 Chihuahua Oaxaca Colima Sonora Puebla . As a result. the states with the most number of ATMs are the ones which present a higher number of debit cards. the relation between payroll accounts and ATMs is of 80%.8 the relation between the financial infrastructure and the use of certain products is analyzed. in other words. the correlation with the number of branches is 77%. we find that a clear correlation exists between both. in populations where a branch does not exist. we can conclude that the presence of infrastructure tends to increase the use of financial products and services. In the case of credit cards.

000 adults ATM per 10.000 adults Branches per 10.50 1.000 adults Source: CNBV .00 2.00 0.00 0 100 200 300 400 500 600 700 R² = 68% Checking accounts Checking accounts per 1.000 adults 3.00 Credit cards 1.91 Chart 4.000 adults 3.00 8.00 0 100 200 Payroll accounts R² = 80% 300 400 500 600 700 800 Payroll accounts per 1.50 2.00 Debit card 4.00 2.00 4.000 adults ATM per 10.000 1.00 6.00 0.50 0.00 0.00 6.8 Financial infrastructures and the usage of products Branches per 10.00 1.50 1.00 0.000 adults 10.00 0 50 100 150 200 250 300 R² = 77% Credit card per 1.50 0.00 300 400 500 600 700 800 900 1.200 Debit card per 1.00 R² = 69% 2.000 adults 10.100 1.00 8.00 2.50 2.

Unlike the first report. its indicators are superior when compared to the other municipal categories.9 Summary of usage indicators by type of municipality per 1. we may observe that the districts that have the most participation in regards to the use of debit and credit cards are Cuauhtémoc.515 720 Credit card 12 26 44 123 210 215 2. as clearly shown.000 adults for each municipality. Graph 4. the indicators are much lower than the national mean. which. In the rural municipalities. there exists a potential market to increase the number of products.000 adults Type of municipality Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF NACIONAL Checkin accounts 24 95 123 322 431 449 635 346 Saving accounts 54 93 209 377 363 356 712 353 Payroll accounts 26 81 74 296 529 653 999 413 Term deposits 6 20 32 45 41 43 96 44 Debit card 75 107 251 652 875 935 1. both in transition and semi-urban.10. Chart 4.9 presents the summary of indicators used per 1. Mexico City is presented separately to avoid an over-estimation of the indicators. in the graph 4. in many cases.000 inhabitants. Because of this.10 Distribution of the usage of credit and debit cards in Mexico City 15% 6% 6% 7% 8% 30% 18% 39% 12% 12% 12% 36% Cuauhtémoc Azcapotzalco Álvaro Obregón Gustavo A. Madero Benito Juárez Miguel Hidalgo Iztapalapa Otras Cuauhtémoc Miguel Hidalgo Benito Juárez Otras Source: CNBV 92 .000 and 50.Municipal-level indicators Chart 4.009 307 Source: CNBV For the case of Mexico City. Benito Juárez and Miguel Hidalgo. they are populations of 30. as.

569 12. Graph 4. an indicator much higher than the national average may be observed for debit cards.12 show the usage indicators for debit and credit cards within the delegations of Mexico City. Madero Cuauhtémoc Benito Juárez Magdalena Contreras.321 National Indicator 720 908 868 763 731 656 648 443 438 359 299 249 Gustavo A. La Benito Juárez Álvaro Obregón Venustiano Carranza Coyoacán Azcapotzalco Iztapalapa Tlalpan Xochimilco Miguel Hidalgo Iztacalco Source: CNBV Cuajimalpa de Morelos Milpa Alta Tláhuac Milpa Alta . of which its national indicator is 720.725 Cuajimalpa de Morelos 321 303 272 270 257 216 National Indicator 307 176 136 130 127 116 74 Cuauhtémoc Gustavo A.000 adults in Mexico City 7.635 1.936 3. Madero Magdalena Contreras. the national indicator is 307.11 Debit cards per 1. La Venustiano Carranza Álvaro Obregón Azcapotzalco Coyoacán Iztapalapa Tlalpan Miguel Hidalgo Xochimilco 99 Iztacalco Tláhuac Source: CNBV Graph 4.368 7.11 Credit cards per 1. In four of them. and as for credit cards.050 3.216 4.000 adults in Mexico City 16.11 and 4.93 Graphs 4.

the presence of Commercial Bank branches is analyzed in rural municipalities and is compared with the number of debit card contracts.13. as shown in graph 4. 94 . of the 732 rural municipalities of the country. Like it is mentioned in the previous chapter.14 presents the information relative to the number of debit card contracts registered in the banking institutions with the presence of rural municipalities.Presence of the Commercial Bank in rural municipalities In this section. The banks with the greater number of branches in the rural municipalities are Banorte.13 Presence of the Commercial Bank in rural municipalities Distributions of branches in the country 15% 30% 14% 22% % Rural 6% 17% 6% 1% 9% 29% 11% 2% 39% Rurals Semi-urbans In transition Urbans Banamex Santander BBVA Bancomer Inbursa Banorte Wal-Mart Semi-metropolis DF Metropolis Source: CNBV Table 4. at least 55 report one branch of a financial institution and only 15 of those have the presence of a Commercial Bank. Graph 4. BBVA Bancomer has 81% of these contracts and Banorte has 14%. BBVA Bancomer and Banamex.

This distribution is shown in graph 4.14 Participation of Commercial Bank in rural municipalities Bank BBVA Bancomer Banorte Banamex Inbursa Wal-Mart Santander Total Municipalities with branch 4 7 2 1 1 2 15 Debit card contracts 58.15 Banks with presence in transition municipalities Distributions of branches in the country 15% 30% 14% 5% % In transition 3% 11% 27% 1% 2% 9% 10% 10% 22% 11% 29% Banamex BBVA Bancomer Santander Bancoppel Rurals Semi-urbans In transition Urbans Banorte HSBC Semi-metropolis DF Metropolis Banco Azteca Otros Source: CNBV . Banamex has 27% of the branches.390 81 0 72. followed by BBVA Bancomer with 22%.95 Table 4. Graph 4.945 2. 193 of which count with at least one branch of a financial institution and 107 with one branch of the Commercial Bank.15.980 9.506 % Debit card contracts 81% 14% 3% 2% 0% 0% 100% The total number of municipalities doesn’t necessarily coincide with the sum due to the fact that in some municipalities there is more than one institution. Source: CNBV Presence of the Commercial Bank in municipalities in transition In Mexico. Banorte with 11%. In the municipalities in transition. there are 678 municipalities in transition.110 1. and Santander and HSBC with 10% each.

A.331 52. Baja California is the only state in the country that does not report any Cooperative branches.16. in the use of credit products. This can be seen in chart 4.029 Cooperative branches that exist all around the country are found.595 3.319 % Debit card contracts 36% 18% 12% 12% 10% 5% 3% 2% 1% 1% 0% 0% N. 96 . A. particularly.593 78.481 996 89 N. Michoacán with 99 and Oaxaca with 74 branches.930 8. 100% The total number of municipalities doesn’t necessarily coincide with the sum due to the fact that in some municipalities there is more than one institution. = Not applicable Source: CNBV The role of the Cooperatives in credit placement This section presents the first analysis about the impact that the Cooperatives have in the financial system and. 436.516 52.17. where 56% of the 1.269 23. the greater part of the Cooperatives is found in the Central-West area of the country.Of the debit card contracts given in the transitional municipalities. Jalisco with 167.240 45. BBVA Bancomer occupies first place with 35%. Santander with 18% and Banorte and HSBC both with 12% of the contracts reported. N. Among the states that have a greater presence of Cooperatives is Guanajuato with 193 branches. Graph 4.16 Participation of Commercial Bank in transition municipalities Bank BBVA Bancomer Santander Banorte HSBC Banamex Bancoppel Banco Azteca Ahorro Famsa Inbursa Banco del Bajío Scotiabank Inverlat Wal-Mart Compartamos Total Municipalities with branch 38 13 19 17 29 4 5 3 1 3 1 3 4 107 Debit card contracts 154. As it can be seen in graph 4.A.806 3.473 12.

17 Cooperative branches per region 581 213 108 107 20 Central-West Source: CNBV Center Northeast Northwest South-Southeast The Cooperative branches are concentrated in the urban. semi-urban and semi-metropolis municipalities.000 adults is greater in such municipalities. it may be observed that the demographic indicator of the number of branches per 10. the entire analysis of Cooperatives is presented in one section for a better comprehension of its impact on Financial Inclusion. due to the adult population that lives in rural municipalities. Even if these indicators are of Access. However.97 Graph 4. Graph 4.18 Cooperative branches per type of municipality a) Number of branches 360 216 222 81 43 97 10 Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF Source: CNBV .

consumer credit and housing credit.19 0.11 0.19 Distribution of Cooperative contracts by type of municipality Commercial 0% 3% 17% 4% 9% 27% Consumer 0% 3% 4% 17% 13% 26% 40% 37% Housing 0% Rural 1% 6% 33% 4% 16% In transition Semi-urban Urban Semi-metropolis 40% Metropolis DF Source: CNBV 98 . segmented by the type of population. while the consumer and housing credits are mostly used in the urban and semi-metropolis areas.10 0.36 0.18 0.19 presents the distribution of contracts of each one of the products.000 adults 0.b) Branches per 10.16 0.01 Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF Source: CNBV There are three credit products that manage the Cooperatives: commercial credit. Graph 4. The majority of the commercial credits are found in the semi-urban and urban municipalities. Graph 4.

4 22. Graph 4. These conclusions can be seen in graph 4. which shows the number of contracts of each credit product per 1.2 17.4 0.7 0.0 Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF b) Consumer 36.9 29.8 0.7 24.0 2.1 2.0 24.9 0.20 Number of contracts of Cooperatives per 1.3 1.000 adults a) Commercial 3. amplifications and house improvements.99 The consumer credit and the commercial credit are the most used products in the rural municipalities. The housing credit is used more in the urban and semi urban areas.20. It is important to emphasize that a good portion of the housing credits that the Cooperatives give are not for acquiring realty but rather for adaptations.000 adults.9 Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF .

given its population.6 0.8 0. The state of Colima stands out in regards to the number of consumer credits because.0 0. it presents an important indicator.0 Rural In transition Semi-urban Urban Semi-metropolis Metropolis DF Source: CNBV In table 4.c) Housing 1. 100 .21. a summary of the number of branches and credit contracts is presented with its respective indicators.3 0.6 0.1 1.

50 0.01 0.36 0.019 6.11 0.811 759 62 134 40 727 140 501 65 145 50 580 20 155 154 40 591 139 16 51 0 13 8 0 60.424 94 1.101 Table 4.15 Usage indicator Total contracts per 1.114 10.361 45.07 0.13 0.524 3.151 25.12 0.651 40.785 2.737 341 1.179 19.516 2 1.05 0.56 0.242 23.471 16.089 103.13 0.088 484.951 0 67 2.019 Commercial Consumer 7.33 0.088 9.641 236 2.01 0.05 0.284 427 10.10 0.01 0.980 5.17 0.04 0.707 11.438 55.07 0.15 0.84 0.000 adults 0.038 120.22 0.025 22.243 40.927 1.27 0.21 Credits granted by Cooperatives segmented by branch and by state Number of contracts State Guanajuato Jalisco Michoacán Oaxaca Querétaro Colima Nuevo León Veracruz San Luis Potosí Yucatán Chihuahua Coahuila Guerrero Puebla Zacatecas Nayarit Durango Campeche Sinaloa Aguascalientes Morelos México Quintana Roo Tamaulipas Hidalgo Distrito Federal Tabasco Sonora Baja California Sur Chiapas Tlaxcala Baja California NATIONAL NATIONAL WITHOUT DF Branches 193 167 99 74 61 37 34 34 33 31 23 22 20 20 20 19 16 14 14 13 13 12 12 12 11 10 6 4 2 2 1 0 1.599 Housing 12.757.723 3.722 141.142 15.25 0.961 814 984 697 1 462 842 9 739 1 0 0 0 0 1 0 103.607 259.298 43.000 adults 145 55 67 60 58 123 20 14 46 13 24 11 14 12 48 86 42 7 6 35 39 2 4 10 3 1 1 1 1 0 3 0 25 28 Source: CNBV .06 0.168 793 1.073 73.121 5.849 60.21 0.05 0.025 62.868 26.877 3.09 0.842 214 2.02 0.760 73.519 3.136 4.585 56.01 0.710 Access indicator Branches per 10.029 1.00 0.683 312 574 2.821 57.513 44.734 47.30 0.767 1.09 0.763.220 3.19 0.

it can be observed that people use this service less as time goes on. we have the number of transactions made in ATMs. which are also separated by credit and debit cards and their indicator per 1.22.000 inhabitants.900 1. In the case of debit card withdrawals. we hope to have the information at a state and municipal level. Graph 4. In the case of the credit cards. Transactions in ATMs at a national level The demographic indicator of the transactions in ATMs can be observed in the graph 4.700 2. and their indicator per 1.100 2.500 2.000 inhabitants to 3. On the other hand. This indicator is calculated per 1.000 in a period of five years. the indicator has increased at an important rate from 2. we have the number of transactions made in point of sale terminals.300 2.22 Quarterly tendencies of the total number of transactions in ATMs per 1.000 inhabitant a) Debit card 3. The analysis that is presented below is divided into two parts. including debit cards as well as credit cards. On one hand.Transactions In this report.000 inhabitants.100 1.700 T1 2005 T2 2005 T4 2005 T1 2006 T2 2006 T1 2007 T2 2007 T1 2008 T2 2008 T3 2008 T2 2009 T3 2009 T3 2005 T3 2006 T4 2006 T3 2007 T4 2007 T4 2008 T1 2009 T4 2009 T1 2010 Source: Bank of Mexico 102 . we begin to analyze the credit and debit card transactions at a national level taking the information from the Bank of Mexico.900 2.000 inhabitants43 and it represents the number of withdrawals made in one trimester.300 transactions per 1. For the third report.300 3.

the number of operations decreases compared to the trimester before October-December. of which in the second and last trimester the numbers were similar to 2008 (see graph 4. .8% compared to the previous year.103 b) Credit card 140 120 100 80 60 40 20 T2 2005 T3 2005 T1 2006 T3 2006 T1 2007 T2 2007 T4 2007 T2 2008 T4 2008 T1 2009 T3 2009 T1 2010 T1 2005 T4 2005 T2 2006 T4 2006 T3 2007 T1 2008 T3 2008 T2 2009 T4 2009 Source: Bank of Mexico It can be observed that each year the number of transactions in ATMs has increased compared to the previous year.23). the operations increase in the substantial manner for the holiday period. in the first trimester of each year. adding to 325 million transactions. except in 2009. in the last few months. This is due to the fact that. The graph also shows the seasonality in regards to the number of transactions because. For the first trimester of 2010. 43 Compared to the other indicators. we already observe an increase of 3. this one is calculated based on the number of inhabitants due to the fact that there is no annual historical information of the number of adults.

000 190.000 290.000 T3 2005 T4 2005 T1 2006 T2 2006 T3 2006 T1 2008 T2 2008 T3 2008 T4 2008 T1 2009 T1 2005 T2 2005 T4 2006 T1 2007 T2 2007 T3 2007 T4 2007 T2 2009 T3 2009 T4 2009 Debit Credit Source: Bank of Mexico 104 T1 2010 .000.000.24 the number of transactions per type of card may be seen. Graph 4.000 330.000.000 270.000 300.000.000.8% in the first trimester of 2010.000.000.000 240.000 260.000.000 Q1 Q2 Q3 Q4 2005 Source: Bank of Mexico 2006 2007 2008 2009 2010 In graph 4.000 280. from 4.000 340.000. It is important to highlight that the percentage of transactions made with credit cards has been decreasing each year. Number of transactions in ATMs per type of cards 350.Graph 4.000 310.000 230.000.000 220.000.000 170.000.000 210.23 Quarterly tendencies of the total number of transactions in ATMs 360.000 320.2% in 2005 to 1. This could be due to the commissions charged for cash provision and the credit restrictions since 2009.

the average transactions with debit cards have been increasing. T1 2010 T1 2005 T2 2005 T3 2005 T4 2006 T1 2007 T2 2007 T3 2008 T4 2008 T1 2009 .000 inhabitants. the transactions made with debit and credit cards in point of sale terminals are analyzed.105 From 2006 a consistent trend may be observed of withdrawals made with debit and credit cards but. while a marginal decrease may be perceived in relation to the average use of credit cards. This can be seen in graph 4. in the first 2010 trimester. In the case of credit cards. this indicator has presented a decrease in relation to the highest levels registered in 2008. Graph 4.26. which means an increase of 20% in the last year. 1. from the first trimester of 2009.200 transactions per 1.000 inhabitants per trimester. In this area last year. As we can observe in graph 4. the indicator remained in between 800 and 900 transactions per 1.25 Average withdrawals per transaction per type of card 1600 1500 1400 1300 1200 1100 1000 T4 2005 T1 2006 T2 2006 T3 2006 T3 2007 T4 2007 T1 2008 T2 2008 T2 2009 T3 2009 T4 2009 Debit Credit Source: Bank of Mexico Nationwide transactions in point of sale terminals In this section.25. the number of debit card transactions has increased considerably until reaching.

Graph 4.26 Quarterly tendency of the number of total transactions in point of sale terminals per 1,000 inhabitants a) Debit card
1,200 1,000 800 600 400


T2 2005

T3 2005

T1 2006

T3 2006

T1 2007

T2 2007

T4 2007

T2 2008

T4 2008

T2 2009

T3 2009

Source: Bank of Mexico

b) Credit card
1,000 900 800 700

500 400 300 200


T1 2005

T4 2005

T1 2006

T3 2006

T4 2006

T2 2007

T3 2007

T1 2008

T2 2008

T4 2008

T1 2009

T3 2009

T4 2009

T2 2005

T3 2005

T2 2006

T1 2007

T4 2007

T3 2008

T2 2009

Source: Bank of Mexico

The number of total transactions made in point of sale terminals has increased continuously every year, as shown by graph 4.27. During 2009, when the transactions in cashiers decrease, the ones made in POS terminals maintain a lower growth rate compared to other years. In the first 2010 trimester a recovery can be perceived, as the transactions have an increase of 12% in relation to the same period the previous year.


T1 2010

T1 2010

T1 2005

T4 2005

T2 2006

T4 2006

T3 2007

T1 2008

T3 2008

T1 2009

T4 2009


Graph 4.27 Quarterly tendency of the total number of transactions in POS terminals
250,000,000 230,000,000 210,000,000 190,000,000

150,000,000 130,000,000 110,000,000 90,000,000 70,000,000 50,000,000 Ene-Mar Abr-Jun Jul-Sep Oct-Dic







Source: Bank of Mexico

In opposition to what happens with the use of a credit card in the cashiers, the POS terminals represent at present 41% from the total amount of transactions; however, a significant decrease related to the 2007 levels, where such indicator represented more than 50% of the total transactions, can also be perceived (see graph 4.28).

Graph 4.28 Number of transactions in POS terminals per card type

50% 50% 49% 50%

46% 49% 44%




180,000,000 140,000,000 100,000,000 60,000,000 20,000,000
T1 2005 T2 2005
49% 50% 49% 48% 51% 53% 53%




T1 2008

T2 2008

T3 2008

T4 2008

T1 2009

T2 2009

T3 2009

T4 2009

T3 2005

T4 2005

T1 2006

T2 2006

T3 2006

T4 2006

T1 2007

T2 2007

T3 2007

T4 2007



Source: Bank of Mexico

T1 2010

Regarding average transactions, the use of credit cards in point of sale terminals is quite above the one of debit cards, reaching more than $800 in average, while the former has remained constant over time in $500.

Graph 4.29 Average transaction per card type




T1 2005 T3 2005 T4 2005 T2 2006 T4 2006 T1 2007 T2 2007 T3 2007 T1 2008 T3 2008 T4 2008 T2 2009 T4 2009 T1 2010
T2 2005 T1 2006 T3 2006 T4 2007 T2 2008 T1 2009 T3 2009



Source: Bank of Mexico

Family remittances44 This section presents a first effort to show the information concerning remittance transfers in the country. In the future, indicators will be made to measure remittance flows in relation to the population and analyze its impact on Financial Inclusion. The amount of family remittances45 entering Mexico has become a significant source of resources for the country and one transfer among private users strengthens family consumption, the reason for which its importance has risen increasingly in Mexican economy. Although nationwide remittances represent 2.3% of GDP, in 2008, for some states family remittances have a significantly higher participation. Particularly, in 2008, the most recent year for which there is information about state GDP, in some entities the remittance income was higher to the national GDP percentage. In regard to remittance income as a percentage of state GDP, Michoacán stands out with 9.2%, Oaxaca with 9.0%, Guerrero with 8.9% and Zacatecas with 8%.


We are grateful for the collaboration of Bank of Mexico in the elaboration of this section Remittance and family remittance is used indistinctly.


2 1.6) 737 (3.F.9 0.2) 1.6) 106 (0. Source: Own elaboration with Bank of Mexico data. it may be observed that the banking infrastructure is limited.1 0. .1) 1.0) 410 (1.2) 1.1 2 4 6 8 10 500 1.3) 33 (0. safer and more efficient.4 1.945 (9. especially Guerrero.4 0.6) 458 (2.0) 606 (2.2) 173 (0.4) 57 (0.5 5.2) 1.2 2.000 adults indicator is below the national average. due to the fact that the number of branches per 10. The family remittance flows represent an opportunity to take advantage of the transactional character of the same to impulse financial services and products that are timely.6) 329 (1.6) 299 (1.3 2.2) 424 (2. for some entities with high remittance flows.7) 1.4 3.8) 364 (1.2 2. Nevertheless.4) 981 (4.1) 1.6 5.7) 542 (2.1) 1.9) 570 (2.149 (5.6 0.2 9 8.6 0.8 5. Oaxaca and Veracruz.2 2.000 1.3) 281 (1.9 2.5 3.305 (6.7 3.7) 348 (1.000 2.500 *The numbers in parentheses correspond to the percent participation rate of each state in total revenue remittance.5) 631 (3.9 0.500 2.9 5.30 Family remittance per state Million Dollars in 2009 Michoacan Jalisco Puebla Oaxaca Mexico City (D.3 Sinaloa Chihuahua Queretaro Baja California Sonora Tlaxcala Colima Yucatan Campeche 0 4 3.6 0.2 4.) San Luis Potosi Zacatecas 2.9 2.716 (8.2 1.3) 257 (1.4 1.5) 87 (0.4 0.204 (5.133 (10.9 8 5. This situation reduces significantly the potential linkage between the flows and the financial services.2) 246 (1.715 (8.109 Graph 4.294 (6.4) 285 (1.8) 117 (0.9) 381 (1.2) As a percentage of GDP in 2008 Michoacan Oaxaca Guerrero Zacatecas Nayarit Guanajuato Hidalgo Morelos Tlaxcala Puebla Chiapas San Luis Potosi Colima Durango Veracruz Jalisco Aguascalientes National Mexico Sinaloa Queretaro Tamaulipas Chihuahua Sonora Baja California Coahuila Yucatan Distrito Federal Quintana Roo Baja California Sur Nuevo Leon Tabasco 0 9.

20 – 1. Source: CNBV 110 .31a Cumulative income per family remittance in millions of dollars in 2009 Range High Flow ( > US$ 900 Million) Medium Flow ( US$ 300 – US$ 900) Low Flow ( < US$ 300 Million) Average income: US$ 662 millions per State.000 adults) Low ( < 1.62 Branches per 10.47 Bank Branches per 10. Source: Elaborated with information from the Bank of Mexico 4.000 adults) Average State-level access indicator : 1.000 adults) Medium ( 1.000 adults (Commercial Bank and State-owned Bank) in 2009 Range High ( > 1.62 Branches per 10.20 Branches per 10.000 adults.Graph 4.31 Cumulative income distribution from family remittance and demographic indicators of access 4.31b Branches per 10.

7 7. .9% of their total income (graph 4. it should be emphasized that the proportion of households that receive remittances is higher in the poorer sectors of the population and. while only 3. 7. and the contributing proportion to the total income of the households that receive them is of 37.5 29.111 The importance of family remittances According to the information of the National Survey of Income and Household Expenditure of 2008. Graph 4.9% of country households receive remittances.5 6. the households are sorted in deciles according to their total quarterly current income.5 IV III 40.4 V IV III II I 6.8 5.8 21 National Average 5.32 Percentage of families that receive remittances and their participation in the monetary current income Families that receive remittances by decile Percentage X 3. INEGI 46 The deciles are calculated considering both households that receive remittances and those who don’t. and these represent 55% of their total current income.5% of the households of higher income levels (the highest decile) receive remittances.5 Remittance participation in current monetary income of household that receive them Percentage X IX National Average 37. at the same time.6 45 II I 46. these resources represent a larger proportion of their income. However. and the participation of remittances in the income of the households that receive them is calculated as the income ratio from other countries in relation to the monetary current income.8% in average.0 6.3% of the households of lower income (decile46 of lower income) receive remittances.3 7.9 IX VIII VII VI VIII 24. which are equivalent to 11. 5.32).9 VII VI V 7.9 4. In effect.7 11.3 55 Source: National Survey of Income and Household Expenditure of 2008.2 4.7 33.1 39.

http://www. There are at least two ways of linking remittances in the financial sector: 1) As a vehicle of entry to the financial system through the opening of deposit accounts (either via bank accounts or another authorized financial institution) to use them as transactional accounts of remittance. In the graph 112 . 47 One of the most important drivers to Financial Inclusion through the delivery and reception of remittances in Mexico. as well as the opportunity of smoothening the flows with micro insurances in case of any unexpected events. which receive important flows of remittances. have few savings accounts per 1.000 adults47. international organism linked to the Inter-American Development Bank (IDB). is the Multilateral Investment Fund (MIF).33. When increasing the security of the remittance delivery it becomes possible to create assets through saving and to leverage the resources of the remittances through credit.Family remittances and Financial Inclusion The relationship between family remittances and the banking sector is important for the potential that the intermediation of these flows may have to maximize its impact on development. and in other regions of Latin America. In the last years it has developed various projects in Latin America to promote this end. it can be observed that states like Oaxaca and Yucatan. and 2) As the possibility of offering additional financial services both to the remittance senders and their beneficiaries. A greater access to financial services allows the reduction of transfer costs for the senders and receivers of remittances.iadb.

000 adults) Average State-level access indicator : 1.113 Graph 4.000 adults) Low ( < 1. Source: CNBV .62 Branches per 10.000 adults.47 Bank Branches per 10.20 Branches per 10.33 Average distribution of family remittance and use indicators of saving accounts (2009) a) Average amount of delivery per remittance operation in 2009 Range High ( > US$ 340 per remittance) Medium ( US$ 307 – US$ 340 per remittance) Low ( < US$ 306 per remittance) Average Flows: US$ 317 per remittance Source: Elaborated with information from the Bank of Mexico b) Saving accounts per thousand adults in 2009 Range High ( > 1.62 Branches per 10.000 adults) Medium ( 1.20 – 1.

819 15.2 -0. It also shows that the average remains constant at around 317 dollars.6 million.35. Source: Bank of Mexico Annex 5 presents additional issues concerning remittances. 3/Dollars. from which more than 80% are concentrated in urban areas49. In the last year the growth was close to 11% compared to 2008. the section is divided in three parts: 1) the universe of Internet users in Mexico.784 5. Target Group Index (by Kantar Media) and the AMIPCI. Universe of Internet users At the end of 2009 the number of “internauts”48 (internet surfers) over six years of age reached 30. as it may be seen in graph 4. Banking through Internet This section presents an initial effort to identify the opportunities that the Internet represents for the use of financial services.497 325 21.0 -8. From April 2010 a slight increase in remittances may be seen again. 114 .3 1/ Million dollars.7 -8.797 317 Number of remittances 3/ Annual percentage changes 2009 2010 Annual Jan-Mar Apr Remittances amount1/ Number of remittances Average remittance 3/ 2/ -15.0 -3. as compared with the same month in 2009 (see table 4. Table 4. the instruments used for the delivery of these.377 313 Apr 1. 2/Thousands of operations. INEGI. 48 According to the AMIPCI (as in the Mexican abbreviation).34 Income per family remittances 2009 Annual Remittances amount Average remittance 1/ 2/ 2010 Jan-Mar 4. the number and average of remittances for 2009 and for the first months of 2010 may be observed. For this. Each year the number of Internet users increases in an important way. the amount data.34.Amount of remittances and number of transactions In table 4.4 -12.34).9 -8.181 66. the family remittance corridors between Mexico and the United Stated and the Mexican Consular Identification cards. 49 Data provided by CONAPO. the viability for linking remittance flows to potential networks of traditional agents and mobile telephony. such as the cost of transactions.4 0. 2) Bank usage via Internet and 3) electronic commerce. the term “internaut” refers to those who surf through the Internet network.1 0.

6 27.300 interviewed people in between 12 and 64 years of age in 28 cities with more than 500 thousand inhabitants.36. as is the population percentage that uses Internet services per socioeconomic level (SEL).1 2005 2006 2007 2008 2009 Source: Mexican Internet Association. The socio-economic level calculated by TGI is based on the algorithm AMAI (Mexican Association in Market Research Agencies and Public Opinion) 13x6.35 Universe of Internet users a) Internet Users in Mexico (millions) 30. AMIPCI b) Internet surfer population (millions) 25.6 5 Urban areas Not urban areas Based on a survey made in urban areas50. 50 TGI survey (Target Group Index) that is annually applied to 12.9 20. the age group that had the highest growth among Internet users goes from 34 to 44 years of age.2 17.6 23. which shows in graph 4. .115 Graph 4. from this total universe of Internet surfers.

AMIPCI 116 . AMIPCI b) Internet surfers’ penetration by SEL ABC+ 48% 43% 37% 71% 63% C D/E 20% 33% D+ 20% 0% 10% 20% 30% 2009 40% 2008 50% 60% 70% 80% Source: TGI survey (Target Group Index).36 Classification of Internet surfers by age and SEL a) Internet surfers’ penetration by age 12-19 20-24 25-34 38% 35% 31% 24% 23% 68% 63% 61% 55% 35-44 45-54 55-64 12% 10% 19% 0% 10% 20% 30% 2009 40% 2008 50% 60% 70% 80% Source: TGI survey (Target Group Index).Graph 4.

Additionally. government agencies.4 million users) in 2008. Source: AMIPCI Bank usage via Internet It is estimated that.2% (1. The analysis of the online survey was made by the Elogia enterprise.825 adults per rage ages (from 18 to 65 years of age).amipci. Nevertheless. from this total amount only 12. information from the TGI Kantar enterprise was used as survey control. gender and socio-economic level. For more information visit the website http://www. .38.117 Graph 4. From the total number of users of the financial system that make use of the Bank via Internet. For such study. the AMIPCI works closely with major market research agencies. which was applied to 1. 72% (14.8 million users) uses the Bank via Mexican Internet Association (AMIPCI) The Mexican Internet Association (AMIPCI) was founded in 1999 with the mission of boosting the Internet economy in Mexico. For the development of their studies and reports. almost 37% uses this service two or three times a week. as it may be seen in graph 4. educational institutions and even with information provided by affiliated businesses.7 million users) handles some kind of banking It currently has more than 200 members who have influenced the development of the Internet Industry in our country. from the total number of Internet surfers over 18 years of age (20. an online survey about the usage of banking products via Internet was designed. elaborated with the support of Safety Pay and the Mexican Bankers Association. 51 Figures obtained from AMIPCI’s study on Banking via Internet in Mexico 2009.

7 56% 12% • 1.38 Bank Users via Internet 12% 28% 72% 88% Do not handle a banking product Handle a banking product Use the Bank via Internet Do not use the Bank via Internet Number of Internet and Bank users (millions) Internet users over 18 years of age Users that handle a banking product Bank users via Internet Reasons for using the Bank via Internet • 20.Graph 4.39.8 Personal Work Both Source: Study on Banking via Internet in Mexico. 118 .4 32% • 14. as it appears on graph 4. 2008 It is important to mention that the activity of the Bank users via Internet consists mainly on checking their account balances. AMIPCI.

E-commerce is the exchange of goods and services made via Information and Communication Technologies. In this way.119 Graph 4. usually with the support of standardized platforms and protocols. an online survey was carried out to know the purchase habits of the Mexican Internet surfer. apart from using the market information provided by the principal enterprises that make e-commerce53 in Mexico. where. electronic commerce is an additional channel in which transactions are made using debit and/or credit cards. 52 Elaborated by AMIPCI sponsored by Visa and the information of Select.39 Main activities made when using the Bank via Internet Checking account balances Transfers between my accounts Service payment Transfer to third parties Transfers to accounts in other banks Credit card payment Refill purchase of airtime for cell phone or… Federal taxes payment Purchasing goods and services Local taxes payment General content and information that the bank … Financial simulators IMSS / INFONAVIT payment Payroll payment / dispersion Investment management Product hiring 95% 58% 54% 48% 44% 37% 28% 22% 21% 18% 13% 11% 9% 8% 7% 7% Source: Study on Banking via Internet in Mexico. services and information via the communication network. 53 . sale or goods exchange. AMIPCI. 2009 Electronic Commerce Electronic Commerce is defined by the studies of the Organization for Economic Co-operation and Development (OECD) as the process of purchase. In 2009 the Study of Electronic Commerce52 was published.

Chart 4. it was estimated that the percentage of sales via Internet form enterprises that have physical and virtual presence would pass from 8% to 16%54. Graph 4. The percentages in graph 4.200 78% 70% 1.40 shows the increase in annual sales.41. 120 . This reached a figure of 1.800 85% 90% 80% 70% 60% 1.000 1.000 800 51% 1. we can gauge the evolution of electronic commerce in Mexico. the profile of Internet users who engage in this activity and the opportunities presents this new sales channel in our country.400 1.768 million dollars in sales in 2008 and exceeds by a wide margin growth expectations.600 1.Thanks to the results of this analysis.40 shows the evolution that has taken e-commerce in our country. AMIPCI. 54 B2C: Business to Consumer is the best known electronic business. 2009 For 2009.768 50% 40% 30% 600 400 200 955 209 2004 20% 10% 0% 315 2005 537 0 2006 2007 2008 Source: Study from Electronic Commerce in Mexico. as it may be seen in graph 4.40 Tendency of electronic commerce in Mexico (million dollars) 2. and it refers to a company which sales its goods or services via Internet.

42 B2C sales14 100% 90% 80% 70% 60% 50% 40% 30% 4% 5% 14% 35% 44% 50% 61% 20% 10% 0% 2006 Metropolitan Area 51% 36% 2007 Inside the Republic 2008 International Source: Study from Electronic Commerce in Mexico. Graph 4. 2009 It is interesting to highlight that the growth reported from the international sales and inside the Republic presents an increase of 180% and 14% respectively. AMIPCI.121 Graph 4.41 Estimated sales via Internet for 2009 100% 80% 6% 8% 16% 60% 40% 94% 92% 84% 20% 0% 2007 Sales via other means 2008 Sales via Internet 2009 Source: Study from Electronic Commerce in Mexico. AMIPCI. 2009 55 55 B2C: Business to Consumer .

122 .

that is to say. he will not have the tools to initiate. maintain or enhance patrimony or he could choose his basket of goods in an inadequate way. to achieve an effective Financial Inclusion in the population.123 FINANCIAL EDUCATION AND CONSUMER PROTECTION Financial education and consumer protection are two essential elements to encourage the use of financial products and services. . Consumer protection is equally important because it seeks to put the suppliers and demanders of financial services in similar circumstances. thus paying high commissions or using services that don’t meet his needs to one hundred percent. If an individual lacks or has a poor financial education.

Financial Education As in the case of Financial Inclusion. and international experiences in the field. This training complements the efforts to promote a greater competition between institutions that results in better products and services. which aim to prevent these users from losing interest in acquiring any financial product or service due to an unpleasant experience. efforts related to financial education in the country have increased significantly.To achieve a successful Financial Inclusion. to save in low proportions or nothing at all. and a conceptual framework is presented for developing indicators to monitor the progress of these components. and understand their rights and obligations as consumers of financial products and services. lower prices and in the decrease of asymmetric information between financial institutions and consumers. important changes have been legislated for greater transparency and information access on the characteristics. Financial education is a component that contributes to strengthening and consolidating the inclusion process. In the last six years. For such transparency to achieve its objective on promoting greater competition among institutions. In this Chapter. initiatives developed by various institutions and agencies in 56 OCDE. For consumers who have not received an adequate attention from the institutions. However. 124 . which even guarantee the inclusion of mechanisms for clarifications and questions. so far there is no single definition of financial education. two components that support Financial Inclusion are explored for the first time. CGAP and DFID “The case for financial literacy in developing countries. The available evidence shows that people who have little financial education are prone to face problems of over-indebtedness. World Bank. costs and commissions on financial products and services. In Mexico. to hire high-cost funding and to avoid adopting any retirement plans56. the regulation provides protection mechanisms. some institutions have made efforts to improve their services for the entry of new participants. It can be said that financial education is a body of knowledge and tools that enable people to acquire skills and modify their conduct for making decisions about how to achieve their economic goals. According to a study. allow identifying common criteria and having a clear idea of what it is and what is its purpose. Promoting access to finance by empowering consumers”. national efforts instrumented in recent years. it must come accompanied by effective strategies on financial education and ensure that people can interpret information and therefore make better decisions.


the field, increased from 13 in 2007 to 53 in 200957. An important characteristic of such efforts has been the attempt to decentralize urban centers of actions and programs to reach sectors of the population that haven’t even been consumers of financial products and services. (See table 5.1).

Chart 5.1 Mapping of financial education initiatives in Mexico during 2009
Participation by Segment
NGO's 9% Popular finance companies 34 % With an alliance 74%

Communication Media 12 % Academics & museums 11 %

Without an alliance 26%

Public organizations 15 %

Banks & Insurance 19 %

People Reached

People reached


% Inst. 70 %
65 % 55 %

Students Teachers Preschool children House wives Executives / Businessmen Entrepreneurs Institutional Clients Migrants Rural women in poverty conditions Urban women in poverty conditions Peasents / farmers

Personal Finance
Credit Savings

Remittances Insurance / prevision Economic System Corporate Finances Entrepreneurship

22 % 16 % 12 % 10 % 8%

Source: Úrsula Heimann and Sergio Gómez Sainz. “Mapping of financial education initiatives in Mexico”. Sparkassenstiftung für internationale Kooperation”. October, 2009.


Úrsula Heimann and Sergio Gómez Sainz. “Mapping of financial education initiatives in Mexico”. Sparkassenstiftung für internationale Kooperation”. October, 2009.

Another aspect to note is the increased participation of financial institutions, mainly from some Commercial Banks, as well as from several popular financial sector agencies, the latter directed to a rural and urban marginalized population, through Popular Safe, Community Banks, Solidarity Funds, Microfinance institutions, among others. The participation of these agents is relevant, as they are a direct communication channel to current and future users. Overall, the actions undertaken by all institutions and agencies involved have created a greater awareness of the importance of financial education to improve people’s welfare and prevent risks. In the years to come, the main challenges in this field will be: to encourage the participation of a larger number of actors, create the right incentives for financial intermediaries to increase their active participation, promote greater synergy among institutions to avoid effort duplicity and fully exploit the resources for such initiatives and, as a priority, develop indicators to measure systematically the financial education levels of the population, and identify the main barriers to their access, to assess the impact of the implemented actions and determine new strategies. Protection to the consumer of financial services The protection for the consumer or user58 of financial services seeks to balance relations among the consumers and financial intermediaries, so that the authorities and intermediaries are the ones who clarify the terms and conditions of such services, promoting a fair treatment to consumers and providing a timely, efficient and appropriate mechanism in dispute resolutions. (See Chart 5.2). The lack of financial consumer protection contributes to the present situations of: overindebtedness, abusive conditions, inappropriate billing practices, insufficiency of complaints and claims mechanisms, as well as lack of privacy in personal information, among others. Authorities in different countries and financial institutions agree on taking action to protect financial service consumers. The objective is to establish a framework of regulation and supervision that constitutes a tool to balance the information asymmetry, maintain the financial stability and achieve market discipline. In addition, to ensure the operation of the protection mechanisms financial education programs are needed to allow consumers to know and understand in a preventive way their rights and obligations.


The Law for Protection and Defense of Financial Service Users in its 2nd Article defines it as: “A person who hires, uses or for any other cause has some right regarding a financial institution as a result of the operation or service provided”.



Chart 5.2 Consumer protection participants Authorities: Responsible for establishing a relation between financial intermediaries and consumers of financial products and services that develops under conditions of equality and transparency applying the legal norm governing in this area and contributing to promotion of financial education through the divulgation of financial contents and the use of computer tools (simulators, records, etc...).
Source: Condusef

Financial Intermediaries : They have a social responsibility as economic growth promoters as well as an operational responsibility from the knowledge they have of the products and services they offer, which should be applied to implement policies and the criteria for the selection of users, in such way that the latter will be in a position to meet the implicit obligations of hired services or products, and in turn get some benefits.

Consumer: Using the information and support tools at his dispossition, both authorities and financial intermediaries should know the rights and obligations that are beeng acquired and, in this way, determine his capacity to handle them. On the other hand, he must also be able to evaluate the benefit cost of the product or service that he desires to hire.

In Mexico, many years ago, the efforts to create a framework for consumer protection was initiated, being in 1998 when the Law for Protection and Defense of Financial Service Users (LPDUSF, as in the Mexican abbreviation) was approved, and published until January 1999. In the same year, the National Commission for the Protection and Defense of Financial Service Users (Condusef, as in the Mexican abbreviation) was created. Subsequently, various reforms were made to the legal framework, with the objective of strengthening and generating new attributions on consumer protection issues. This deals with modifications as the ones recently implemented on transparency, commissions, advertising, account balances, adhesion contracts, interest rates, and the promotion and dissemination of financial education. (See chart 5.3). It should be noted that one of the most relevant Condusef strengths is on the integral vision that is given by its regulatory framework on the operation of the financial system, as it equally interacts with banks as with insurers, Regulated Financing Companies with Multiple Purposes, etc.; supervision attributions have even been conferred in some matters regarding Non-regulated Financial Companies with Multiple Purposes. Other countries have also initiated actions for the benefit of users. Such is the case of the United States, which recently established the Consumer Financial Protection Agency (CFPA), which has the responsibility of ensuring that the regulations are fair and put into practice in a rigorous way.

gov. February.Likewise. handle and resolve consumer complaints. Another example comes from Colombia who has undertaken reforms in the regulation of its financial system. December. 2010. 2009. which establishes rules and principles governing consumer protection. The reform of Colombia includes measures relating to both the protection scheme and the rights and obligations of the financial services consumers61. “The ABC of financial reform”. “Financial Inclusion and consumer protection in Peru”. Banco Central Do Brasil. 128 . as the supervisor of policies and procedures established by the institutions to receive. 60 Consultative Group to Assist the Poorest Population (CGAP) “Branchless banking and consumer protection in Brazil”. 59 US Department of the Treasury. has created a specialized unit to address all matters relating to the defense and promotion of market transparency62. the government. In the case of Peru. 2010 at: http://web.presidencia. In Brazil59. justice and market access for financial products and services. Insurance and AFP (SBS) y CGAP. “Financial Regulatory Reform. A new foundation: Rebuilding Financial Supervision and Regulation”.co/sp/2009/junio/27/04272009. reforms are proposed in the administrative and regulatory framework to promote transparency. Retrieved on July the 7th. 61 Colombia Presidency of the Republic. Joint Assessment Report. simplicity. 2009.html 62 Superintendence of Banking. in recent years it is required that all authorized financial institutions have an internal ombudsman that has been accredited to deal with unresolved complaints by the customer service departments60.

Cases Atended per Year* (Figures In thousands) 1000 900 800 974 700 600 500 637 400 300 200 100 0 93 163 185 197 383 303 390 329 436 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 * Since 2004in the statistics presented. it also addresses corrective aspects such as the defense of the legitimate interests of service users provided by financial institutions and the promotion of fairness in the contractual relations between them. * Since 2004 it was implemented the Interactive Voice Response (IVR).129 Chart 5. legal defense of the users and educational programs development concerning economic and financial matters. and the requirements to be met by bank statements and operation vouchers. Condusef receives the authority to issue general provisions on the requirements for Adhesion Contracts of massive operations.3 National Commission for the Protection and Defense of Financial Service Users (Condusef) The creation of Condusef in 1999 reflects the need to have an independent. on the form and terms to advertise the operations and services offered by financial institutions. In 2009. To perform these actions Condusef has 36 delegations distributed throughout the country. Over eleven years. the Condusef has provided the following service activities: advice to users. This tool is not considered . Source: Condusef. impartial and specialized organism in resolving disputes arising in the provision of financial services. This tool is not it was implemented Source: Condusef considered in the statistics presented. the Interactive Voice Response (IVR). Within its attributions. preventive functions are contemplated as the promotion of financial literacy among all segments of the population. dispute resolution through conciliatory procedures. arbitration. legal counseling. among others.

consumer protection is based on three principles which must encourage the development of the financial system and ensure a healthy relationship between the participants. Bangkok. Focus Note No. “Consumer Protection. Chart 5. 64 Alliance for Financial Inclusion. transparency is one of the basic principles of consumer protection. AFI. Leveling the playing field in Financial Inclusion”. CGAP: “Consumer Protection Regulation in Low-Access Environments: Opportunities to Promote Responsible Finance”. 60. Thailand. 2010. equity and resources for conflict resolutions63. The basic principles of consumer protection are: transparency. This imbalance of information is higher when the costumers are less experienced and the products are more sophisticated64. For that reason. Policy Note. users have less information about the characteristics of financial products and services to those available to intermediaries who provide services. 130 .4 Consumer Protection Fair Treatment CONSUMER PROTECTION Transparency Recourse Source: Condusef Transparency In general terms.Principles of protection to product and financial service consumer According to some studies. The principle of transparency refers to mechanisms that provide relevant information 63 Laura Brix and Katherine McKee.

clear and timely way. during and after performing a financial transaction. all the mechanisms for effective and timely error resolution. Chart 5. . before. Recourse Under the principle of conflict resolution. Fair treatment The second principle of consumer protection covers the procedures guaranteed by financial intermediaries for a fair and equitable treatment of their current and potential customers.131 to financial service users in a useful. unconformities and disputes between users and financial institutions are included.5 Basic Principles for Consumer Protection Source: Condusef The next reports of Financial Inclusion will deepen on the elements that integrate and show the behavior and evolution of the basic principles of financial product and service consumer protection. Such protection assures that users will not be sold financial products or services inappropriate for their profile.

132 .

65 The initial effort to identify barrier indicators is led by Thorsten Beck. allowing the development of estimates in relation to the percentage of the population using financial services. Beck is currently a professor in the Department of Economics at the University of Tilburg in the Netherlands and he previously worked at the World Bank. efforts have been focused on obtaining data that results in basic indicators of Financial Inclusion. it is important to take into account a third dimension: access barriers.133 FINANCIAL INCLUSION BARRIERS65 Recently. . other efforts are based on surveys on businesses or households. This aggregate information enables us to obtain measurements of Financial Inclusion in two dimensions: access and usage. as the number of branches or financial contracts. however.

Barriers directly affect the access of the population to financial services, hence their use. The identification of barriers offers the ability to detect more easily public policies that maximize the impact on Financial Inclusion. The development of specific indicators, that allow measuring the impact of each barrier, will contribute to the development of a regulatory framework that favors new business and innovation models of financial productions and services. The indicators developed so far based on the number of accounts or the percentage of the population using a particular service, provide information regarding the use of products; likewise, indicators as the number of branches or point of sale terminals focus on geographic access; however, they ignore other barriers such as the contractual framework and lack of financial education, among others. Access barriers may exist either on the side of the supply or on the side of the demand. Graph 6.1 presents a classification to distinguish the possible reasons why, intentionally or unintentionally, people do not have financial services. This classification provides a framework for identifying the various barriers and it facilitates the development of indicators for each of them. Graph 6.1 Difference between access and usage of financial services

Source: World Bank (2008): Finance for all



Financial Exclusion It is important to distinguish between the population that has access, but does not demand financial services, and the population demands services, but has no access. These two groups are not constant over time: with the development of the economy and technology the proportion of people who voluntarily exclude themselves could be reduced, as in a more interconnected World, to participate in the market involves more participation in the payments system and, therefore, in the formal financial system. The voluntary exclusion may occur for different reasons (see graph 6.2). A priori, the segment of the population that says that it does not need financial services does not seem relevant, because somehow the existence of some indirect access is assumed; however, it should be considered that there may be individuals who declare not to need financial services for lack of information, financial education, and even for a lack of marketing in this segment (“lack of targeting”). There are other reasons for voluntary exclusion, for example: religious beliefs, cultural factors and lack of confidence in the financial system; this last may be originated either from personal experience, or by that of a family member or friend. Graph 6.2 Voluntary Financial Exclusion (self-exclusion)

Source: CNBV

Among the groups excluded involuntarily there are different causes that can be distinguished that prevent access to financial services (see graph 6.3). The barrier of insufficient income refers to the group that has no financial services due to low income or, whose incomes are highly volatile. The proportion of the population excluded from this cause may vary with the cycles of economic growth: under improved economic conditions, the costs of providing financial services are reduced, while simultaneously the revenues from the lower segments of the population increase.

Another group that suffers involuntary financial exclusion is one conformed by the individuals that are located at great distances from a bank office as, both travel time and transportation costs are reflected in high costs that prevent them from accessing financial services. There is an important barrier related to costs associated to the maintenance of a bank account, as to specific services, such as: cash withdrawal, check use, debit card use, etc. This category considers the household and business population that is excluded for price or product reasons; which is to say, when the costs for maintaining an account are elevated or because of the lack of products that are adapted to the needs for this segment of the population. There are other barriers, as all the ones related to the contractual framework; these barriers refer to the documentation requirements that are required of homes and businesses to: open an account, ask for a loan, etc. Further on we refer to these obstacles as documentation barriers. Graph 6.3 Involuntary Financial Exclusion

Source: CNBV

Measurement proposals As it has been seen, the barriers affect different segments of the population in dissimilar ways; for this reason, it is necessary for the barrier measurement to incorporate the characteristics of each segment. For example, the cost to open and maintain a bank account must be evaluated in regards to the income of potential customers. To measure the barriers via indicators, both supply


To measure the effect of the barriers. whose information can be illustrated in the first column of table 6. and from information gathered from specialized studies elaborated by the World Bank 66. the reasons for not using these and issues related to financial education in households and enterprises. the data from households and enterprises may be obtained via surveys as the one applied in various countries by Finscope67.137 data (financial institutions) and demand data (users and potential costumers) must be available. etc. Where can an account 66 Thorsten Beck. World Bank Economic Review. Distance barriers To facilitate the possible measurement of this barrier it is important to identify the physical places in which different kinds of transactions can be made. without considering the segment of people excluded for insufficient income. it is necessary to identify if these are originated on the side of the supply or of the demand. vol. Demirguc-Kunt. attitudes and perceptions that consumers have on financial services. Demand barriers are those related to the individual’s decision to consume or not a good or service. the effects may vary depending on demographic characteristics. The supply barriers originate in the policies implemented and decisions made by financial institutions. On the other hand. . 2008. Oxford University Press. 22 (3). For example. Martínez Peria.4. geographic aspects. There are two classes of indicators: those which identify barriers and those which measure the effect of such on Financial Inclusion. M. a barrier that cannot be solved through public policies that promote access to the financial sector. in itself. The collection of demand data will allow to compare both sides of the market and to identify barriers from the demand that are exclusive. Below reviews the different barriers. Banking services for everyone? “Barriers to bank access and usage around the world”. that include questions about the knowledge of certain products and some financial habits such as the propensity to save or the mechanisms used to ensure oneself against unforeseen events. as the level of income represents. The supply data may be obtained from the information that financial institutions provide periodically to the authorities through regulatory reports. This information may be combined with other available statistics at state and municipal levels to construct indicator barriers. Financial education barriers These barriers could be measured using information obtained from household and business surveys. 67 Finscope is an initiative of FinMark Trust from the United Kingdom that develops representative studies at national level in various developing countries on the use. A. allowing a better knowledge of consumer markets. which included questions about financial services usage. infrastructure presence.

in case of credit services. Currently. by phone or by Internet?. Where can transactions. making transactions in POS terminals or in a banking agent. there are several efforts to generate indicators to estimate the effects of each of these barriers. among others. be made: in a branch. to mention some of them.4 presents the possible indicators and data needed to measure these barriers. proof of address and proof of income. certain legal or commercial documents to prove the identity and economic resources of the person concerned. like deposits or withdrawals. Cost barriers Another barrier is constituted by the cost for the costumer on maintaining a bank account and using certain financial services. This will seek to build a more complete indicator framework of Financial Inclusion. The purpose of the indicators is to identify the percentage of the population affected by each barrier and identify what is the most significant barrier for people without access. due to the fact that banks opened: in a branch or with a banking agent?. Where can a credit be requested: in a branch. A possible estimated measurement of this barrier would be to measure the direct cost involved in managing an account. Other considerations include the commissions for specific services such as withdrawing cash at ATMs. be it because they are obliged by bank regulations or because of internal policies. issuing a check. 138 . such as guarantees or having a good credit history. with a banking agent or in an ATM? Documentation Barriers The greatest household barrier in this context is presented at the moment of opening an account. Be it to open an account or request a credit. Apart from the documentation. like passport. collaterals must be considered. Table 6. the population percentage that can meet the respective requirements can be measured.

ATMs and banking agents. (ii) make deposits. ATMs. Percentage of households that show some financial capabilities. (iii) make cash withdrawals and (iv) make payments branches. Internet. Annual cost to maintain a basic account divided by GDP per capita. 2..4 Barrier indicators of household financial access (deposit and payment services) and required data to develop them Barrier Indicator Costs to maintain a basic account including the possibility of cash deposit and withdrawal.139 Table 6. Percentage of households with basic skills in financial mathematics. 2.). Effect-offer indicator 1. Percentage of population with insufficient income to afford the costs of a bank account (assuming 2% of income that can be used for financial services). Percentage of households with no account due to their lack of confidence. their cash preferences or because they are illiterate. Percentage of households with knowledge about some financial products and concepts. 2. Documentation Percentage of population with identity card (passport. Distribution of population and area at state or municipal level. IFE. GDP per capita at state level. Assuming a certain value it is possible to indicate the population percentage excluded because of geographical reasons. make cash withdrawals and (iv) make payments. Effect-demand indicator Percentage of population who does not have a bank account due to its costs. 4. Percentage of population who does not have requested documents. proof of formal employment and other documents required to open accounts. Percentage of population who does not have a bank account due to their lack of required documents. Distance 1. Number of branches. Source: Thorsten Beck . mobile phone. 2. Distance to the nearest bank branch or banking agent based on the answers given in household surveys. 3. Demand 1. Other required data 1. Costs How many and which documents are required to open an account. banking agent. Income distribution at state or municipal level. Average distance to branch or banking agent where it is possible to (i) open a bank account. (ii) make deposits. proof of address.. Places where (i) it is possible to open a bank account.

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