Income from remittances to Mexico beat new record: Banxico

Income from remittances to Mexico registered a new historical maximum, adding 4,540 million dollars in July 2021, reported the Bank of Mexico (Banxico).

Some context: in the first quarter of 2021, Mexico’s current account posted a deficit of $ 5.1 billion, or 1.7% of GDP, compared to a deficit of $ 7.5 billion, or 2.5% of GDP, in the first quarter of 2020.

Above all, the current account deficit was due to a significant reduction in the primary income deficit and the continued dynamism of remittances, which were partially offset by a lower non-oil trade surplus and an increase in the balance deficit. commercial and oil services.

A related fact: the Banco del Bienestar, formerly called Banco del Ahorro Nacional y Servicios Financieros, aims to deliver funds from the Government’s social programs through transparent methods to more than 20 million beneficiaries and meet the specific needs of migrants, offering the best exchange rates in remittances.

From 1988 to 2019, Mexico registered a deficit in its current account, mainly due to the liberalization of trade policies by the Government that increased imports from the private sector.

According to the Mexican government, in 2020, the country’s current account registered a surplus of 2.4% of GDP, or 26.6 billion dollars, the largest current account surplus registered since 1983 and an increase in the current account deficit in 2019 of 0.3 % of GDP, or $ 4.2 billion.

Remittances 

The increase in the current account balance, compared to 2019, was mainly due to a considerable increase in the non-oil merchandise surplus and higher income from remittances.

Income from remittances to Mexico, which is one of the main sources of foreign currency for the country, totaled 4,540.3 million dollars (mdd) in July 2021, which implied the highest monthly amount sent since registration (1995) and a growth of 28.6% compared to what was sent in July 2020.

For its part, during last July the number of operations for sending remittances was 11.6 million, the second highest since the report is available and (after that shown in May 2021) and 13.0% more than those registered in July 2020, with an average per transaction of $ 390, that is, $ 47 above the average amount per transaction reported twelve months earlier.

In the accumulated, remittances sent to our country totaled 28,187.3 million dollars in the first seven months of this year, the highest amount reported for a similar period since it has been registered and 23.5% higher than that sent in the same period of 2020.