Tuesday, May 6, 2008

Banking transactions made by the Mexican remitters

The last post was regarding remitting done by Mexican workers living abroad, it gave an idea on how remittance has emerged in the country in the past few years. In this post the idea is to delve deeper into the matter. The focus is to be on the banking system in Mexico and whether it is systematised enough to cater to the needs of the millions of residents who have family members working in countries like the US and Canada. There is no dearth of banks, currency exchange houses and business houses that buy dollars in Mexican cities and towns. But the chief problem is with regards to the banking knowledge that people have especially, those living in the semi urban areas. A large number of the people do not use the ATMs. Consequently, most cash remittance take place through money orders by mail or through relatives and friends.

Bank to bank money transfers are a good option any given day. These transfers are quick and safe. A small fraction of the Mexicans who receive cash from relatives staying abroad also have “binational bank accounts” but most stay away from it fearing the high costs that the banks charge for this facility.

Of all the banks that operate out of Mexico, Bancomer is a leading name which has branches in Los Angeles and is associated with the US Postal Service. It has won the trust of the non resident Mexicans who have accounts with it and wish to have ATM cards for their relatives. Other banks should follow suit and try to establish presence in countries which have a large Mexican population.

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