Mexico | Did Banco del Bienestar stop paying remittances due to loss of market share?

Summary

Banco del Bienestar leaves the remittance market. The gradual loss in its market share could partly explain this decision: in 2018 it was 4.1%, and in 2022 it was 2.4%. Households in rural and semi-rural areas may be the most affected, since they will spend more on transfers to collect them in other municipalities.

Key points

• Key points:
• Remittances accumulate 34 consecutive months with growth, starting from May 2020. In February 2023, 4,348 million USD arrived in Mexico, +11.2%.
• Banco del Bienestar leaves the remittance market: the gradual loss in its market share could partly explain this decision. In 2018 its market share was 4.1%, and by 2022 it is estimated to be 2.4%.
• The closure of the Banco del Bienestar payment network in the remittance market may affect more households in rural and semi-rural areas, which will spend more on transfers to collect remittances in other municipalities. Thus, municipalities in more urbanized areas and with collection points will increase their intensity in the payment of remittances.
• Between 2020 and 2022, Mexico was not the country with the greatest dynamism in the growth of remittances in the Latin American and the Caribbean region. In this period, it repeatedly ranked sixth in the region in terms of growth in remittances.
• Remittances to Mexico increased 13.4% in 2022, but other countries in the region had higher growth rates: Nicaragua (50.2%), Argentina (38.9%), Brazil (22.5%), Guatemala (17.9%) and Honduras (17.8%).

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