One of the largest economies in Latin America keeps growth momentum going by joining the United Nations’ Better Than Cash Alliance to foster a financially inclusive economy
The Mexican Government is building on its successful economic growth and new financial inclusion policy by pledging to increase the ability of citizens, businesses and the government to make and receive digital payments. By joining the United Nations-based Better Than Cash Alliance, Mexico will propel inclusive growth, empower women and grow the country’s GDP.
The announcement comes shortly after Mexico’s Government unveiled its National Policy on Financial Inclusion that included a call for the country to use technological innovation for financial inclusion and reduce the use of cash.
The existing use of digital payments already brought around $8 billion boost to Mexico’sGDP between 2011 and 2015, according to a recent Moody’s Analytics report. This indicates there is big potential for greater growth. Research conducted by The Better Than Cash Alliance also found that by digitizing its own payments from cash, the Mexican Government saves an estimated US$1.3 billion per year.
Mexico’s announcement to step up efforts to move away from cash comes during a period of slower growth in the Latin America region overall. While Mexico’s economy is an exception and continues to grow, only 44 percent of adults over the age of 18 have a bank account in Mexico, according to the Government’s recent survey on financial inclusion (ENIF, 2015). However, there are 120 million people in the country, and more than 107 million people have a mobile phone, making mobile digital payments a potentially important tool in increasing financial inclusion.
“There is a tremendous opportunity for financial inclusion in front of us that we must seize to build on the momentum of the new National Policy on Financial Inclusion,” said Luis Videgaray Caso, Mexico’sMinister of Finance and Public Credit. “Integrating digital payment technology across all agencies of Government is key to this, and the other benefits of efficiency and cost savings, are too valuable to ignore. This new commitment to The Better Than Cash Alliance, which helps implement both our National Policy on Financial Inclusion and our National Digital Strategy, will improve lives for all of our people and contribute to inclusive economic growth.”
In 2013, the Mexican Government launched the National Digital Strategy “México Digital,” which included the goal of creating a digital economy. Since then, measures taken by the Government to shift away from cash provide a strong foundation from which to expand. The number of digital payment transactions through the Government’s Treasury Single Account increased from 69 million in 2013 to 116 million in 2015. Today’s membership announcement is a strong step in continuing to build a robust digital economy where everybody can easily make and receive electronic payments.
“When Mexico held the G20 Presidency in 2012, the Government put the issue of financial inclusion at the heart of the global agenda” said Dr. Ruth Goodwin-Groen, Managing Director of The Better Than Cash Alliance. “The country has long been recognized for its innovation in driving financial inclusion. Now, Mexico has made another bold move in implementing the new Financial Inclusion Policy to transform how people make payments, empowering millions of its people to participate in a digitally financially inclusive economy and creating many other benefits for the country.”