The benefit of enjoying high living standards at fairly low costs is undoubtedly one of the main reasons why many people are choosing to settle down in Mexico. This popular expat destination has a lot going for it, like its colorful history, rich culture, welcoming people, stable economy, tropical climate, and modern housing options. Its proximity to the United States and Canada is an additional benefit. The recent political debacle with its northern neighbor has weakened the local currency, the Peso, to a great extent; however, the drop has only made this country more attractive to foreigners, who now regard it as a place where their dollars can go further.Getting your finances organized so that you have easy and ongoing access to your money will probably be one of your priorities when you move to Mexico. This is all the more important if you are a salaried professional or a businessperson who makes domestic transactions. Opening a bank account at a local bank, or at a local branch of an international bank, is therefore one of the first items that you should check off your to-do list. The new immigration laws have made it possible for foreign nationals to open a bank account in the country, as long as they meet certain criteria. This applies to residents as well as tourists.
Below are a few guidelines and tips that should make it easier for you to open a bank account in this country.
Mexico is home to more than 30 major national and international financial institutions, offering a wide range of services that include current accounts, saving accounts, investment accounts, direct debit / standing order services, different types of loans, overdraft facilities, mortgages, debit cards and credit cards. The local setups also usually have facilities for people to pay their taxes and utility bills. While many of the banks have no specific services for foreigners, some of them specialize in catering to the requirements of expats. Almost all of them can be accessed online and through mobile applications.
Below is a list of some of the most popular financial institutions in Mexico.
National Bank of Mexico or Banco De Mexico
Tel: +52 55 5237 2000
Tel: 1 800 1226 7735; 1 866 254 3790 (from the US and Canada)
Tel: 1 800 226 2663
Banamex (also referred to as Citi Banamex)
Tel: 1 800 021 2345; 1 800 226 2639 (from the US and Canada)
Tel: 1 800 226 6783
Bank Of America
Tel: +52 55 5201 3200
Tel: +52 55 5721 3390
Tel: +52 55 5258 2129
Santander (commonly known as Banco Santander)
Tel: +52 55 5521 1709; 1 800 501 0000
Tel: +52 55 5728 1900; 1 800 704 5900
Most of the websites are in Spanish but can be translated into your local language using your internet browser.
A majority of expats choose to bank with organizations that have English-speaking staff or complementary translation services. Very often, foreigners prefer opening their accounts with institutions that have some presence in their home countries, either in the form of a branch or an affiliation with a local bank. Some get in touch with their local bank at home to check which institutions in Mexico are the easiest to transact with, depending on their requirements. It is best to opt for a bank which has branches and ATMs that can be easily accessed from your home or workplace.
Take a look at ABM’s website to access a more comprehensive list of banks in this country and their contact information. You can also check which of these institutions are affiliated with the Mexican Banking Association.
You can choose from a fairly wide range of accounts, depending on your requirements, preferences and eligibility. These can be broadly classified into the following groups.
Almost all employed people in Mexico have a basic account called Cuenta de Nomina into which their salaries are directly credited. You will be issued an ATM or debit card for easy access to your money. Banks do not charge fees or commissions on such accounts. The facilities provided to you will also be quite basic.
Every institute with retail banking operations can open a basic checking account for a foreign resident. With this type of account, you will be required to maintain a minimum balance. If the balance in your account goes below this deposit amount, a monetary penalty will be levied. The bank charges may vary, depending on the facilities you choose. Often, banks allow only a limited number of cash withdrawals for free. Be prepared to pay a fee if you exceed the number of ATM transactions permitted. All foreign residents are given the option of opening a Peso denominated checking account or a US Dollar one.
The Peso denominated account is offered to customers of all nationalities. The advantage of this account is that it allows you to earn and manage your finances in the local currency. The minimum opening deposit isn’t very high; it can vary between 10,000 Pesos (US $ 535; £ 415; € 474) and 20,000 Pesos (US $ 1,070; £ 830; € 948).
Citizens of the US and Canada have the option to operate a US Dollar checking account. However, the interest rates are not very attractive and the minimum deposit to be maintained will vary, depending on the facilities you choose.
The banks in Mexico offer two types of deposit account. The first is a “sight deposit account”, in which you are allowed to withdraw your money without giving any prior notice. You will receive an ATM card or a debit card, which can be used at cash points and several retail outlets around the globe. There is a fee for maintaining this account but that can be avoided by maintaining a minimum balance. The interest rates are usually minimal.
The second type of deposit account requires you to hold your savings for a minimum duration of time before you can start making any withdrawals. The notice period can be anywhere between a month and a year. The interest on “notice deposit accounts” is much higher. The rates increase with the notice period.
The big players in the banking industry usually have the “market accounts” option, which allows the holder to purchase and sell stocks directly in international markets. The minimum deposit for these accounts is generally 5,000 Pesos (US $ 267; £ 207; € 237).
Certificate of deposit
This option gives you the best returns on your investments and at the same time, your money is safe with the issuing bank. The minimum deposit to be maintained is therefore considerably high. However, do keep in mind that you can only operate this account in the local currency.
Loyal customers are generally given the option to keep their money in special accounts, with additional benefits like insurance, interest payments and cashback services. There is a monthly fee for such accounts and the eligibility criteria are also quite stringent. You are not likely to qualify for such an account if you are new to the country or are looking for an arrangement to take care of your short-term needs.
There are differences in fees and charges for each of these accounts. It is therefore essential that you explore all options available, before deciding which type of account you would like to open.
Account opening procedure
The fastest way to get your account opened and operational is by visiting the nearest branch of the institution you decide on and meeting a representative. This will allow you to check out all your options and seek clarification on any queries you may have. You can also pick up the forms that need to be filled in and get a checklist of the documents you will have to submit. However, it could take more than an hour to be seen by someone, depending on the day and time of your visit.
The documentation requirements may vary to some extent from one bank to another but in most cases, for a standard account you will be asked to provide:
• Identity proof, like a valid passport or a driver’s license (issued in your country of origin)
• Proof of immigration status (for residents) or business visa copies
• Address proof like a utility bill or rent agreement
• Minimum deposit amount.
In order to open a bank account for a commercial establishment, you will be asked to submit your company’s constitution and other relevant documents.
In countries like the US and UK, it is a challenge for expats to open an account, because of the absence of a strong credit history. Fortunately, this should not be a problem in Mexico, since the banks aren’t so strict.
In some cases, it may be possible for expats to open an account in Mexico even before they arrive. This is not an uncommon practice for entities like HSBC, Santander and Bank of America. For this, you have to put in a request at a branch in your home country.
While almost every financial institution has the online banking option, you will be required to make a visit to the nearest branch to activate your account and sign up for telephone, online and mobile banking services. It takes between 3 to 5 working days for an account to be activated. You should receive your cards and PINs during this time.
Keep in mind that all the forms you fill in are likely to be in Spanish. If you are not fluent in the language, get someone trustworthy to guide you through the whole procedure. Do not sign any credit agreements without a complete understanding of the terms and conditions.
Hidden fees, commissions and poor exchange rates are the main concerns faced by people who send money to overseas accounts. If you are going to receive a major part of your finances from overseas, it may be best to operate your international account through online banking and ATM options, instead of opening one locally.
Things to know
Every bank has their own set of regulations and you are not likely to know about all of them, especially if you are new to the country. Below are a few facts that may be of some importance:
• Branches are operational from 9:00am to 4:00pm. On Saturdays, most banks are open from 10:00am to 4:00pm. However, you can call customer services later in the day.
• There is no tax on bank transfers or check payments. However, your bank may levy a tax on large deposits and cash withdrawals (from other ATMs).
• For your proof of address, if you are submitting a utility bill, make sure that it is no more than two months old. Even a semi-annual bill needs to have been issued within the last month.
• Students cannot open an account with HSBC if they are staying in the country for only one semester. The bank will ask for a certificate from the school, mentioning the duration of the course.
• Santander Bank does not allow its basic account holders to make any international transactions for the first six months after opening it.
Have you lived in Mexico? What was your experience of the banking options there? Share your thoughts in the comments below, or answer the questions here to be featured in an interview!