EconomyMexicans will defy interest rates and ask for more...

Mexicans will defy interest rates and ask for more bank cards

Although 2023 looks set to be a complex year due to the economic slowdown and high inflation, the demand for credit cards will be immune to this scenario.

Despite the high interest rates, the placement of credit cards in department stores and traditional banks will continue to grow due to the little relation that the reference interest rate of the Bank of Mexico (Banxico) has with that offered by plastics with interest rates. up to three digits, refers the risk rating agency Fitch Ratings.

Salvador Espinosa, general director of Prosa, agreed with this perspective and said in an interview with Expansión that growth in the use of cards of up to double digits is expected.

“Last year we registered 6,500 million transactions throughout the year, now we are going for at least 8,000 million transactions only with a physical card,” he commented.

In the first three quarters of the year, 4,372 million credit and debit card operations have been made, 22.2% more than in the same period of 2021, according to data from the Bank of Mexico (Banxico).

The last months of the year will be relevant for the banking industry and payment processors such as Prosa, since this is traditionally when a higher consumption is registered due to the Christmas season and the Good End.

To avoid saturation in payments during these seasons and to mitigate identity theft among users, the firm will invest 100 million dollars over the next five years.

On the other hand, the industry will face a challenge because inflation is expected to continue at levels above 8%, which could reduce consumption in the coming months.

If high levels of inflation continue, both banks and department stores that issue cards could limit the granting of plastics. However, Fitch warned that customers could reduce their ability to pay, which in the future implies an increase in delinquencies.

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