Financial Sector Assessment Program: Mexico – New Technology-Enabled Channels to Scale Up Financial Access

Exploring ways to improve financial inclusion in Mexico

This paper assesses the scope and requirement of expanding technology-enabled channels to increase financial access in Mexico. It seeks to identify how banks, mobile operators, and retailers are coming together to create new banking models. It also analyzes how the government can foster the development of these new banking channels beyond regulation. This paper covers the following sections in detail:

  • Introduction to the policy environment in Mexico focusing on the role played by banking authorities;
  • Scope and potential of using technology as a tool to further financial inclusion in the country;
  • Key issues in Mexico’s financial environment with a focus on regulatory restrictions, oversight of financial service providers, development of correspondent networks, competition among service providers, and the need for reviewing the pricing of a few regulated services;
  • Discussion of the enabling policy framework emerging around branchless and mobile banking in Mexico;
  • Building blocks of branchless banking regulations with a focus on the types of licenses and accounts, electronic transfer mechanisms, banking correspondents, outsourcing of operations, and regulation;
  • Existing mobile banking schemes with a focus on their performance, business models, and how the branchless banking market is shaping up;
  • Recommendations for the government as a regulatory authority, promoter, infrastructure provider, or a market participant.

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