Strengthening Savings and Credit Unions

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It is estimated that around 65 of the remittances flow into marginalized areas of the country without formal financial infrastructure. The Mexican government has proposed the transformation of the Patronato del Ahorro Nacional (PAHNAL) into the Banco Nacional del Ahorro y Servicios Financieros (BANSEFI), which currently works as a second-tier bank for the participants in the Popular Savings and Loans Sector, providing financial services such as risk management, remittances or treasury and trust services This project is supporting the restructuring called for by the laws governing the low-income savings and loan sector so as to promote the orderly development of its institutions, while at the same time protecting domestic savings and an expansion of the financial services offered to small businesses and microenterprises. The project has three components: (i) technical assistance for 1,000 branches belonging to BANSEFI and four currently regulated cajas de ahorro (savings banks) to adapt to the provisions of the new laws; (ii) technological modernization of BANSEFI; and (iii) development of new savings products within BANSEFI. A special aim is to create a network to compete for remittances sent by Mexicans living abroad.