Background on the Subject
Despite concerted efforts by public and private entities to promote electronic payments in Mexico, a significant portion of the population continues to use cash for daily transactions. According to recent quantitative and qualitative studies by Banco de México (Banxico) on cash usage in 2024, 96% of the population reported still using cash for their daily expenses. This figure is higher than 93% in the same period of 2023.
Payment Methods Used
When asked about the payment methods used for daily expenses, 94% of respondents mentioned cash, an increase of six percentage points from the same period in 2023 when it was at 88%.
- Debit card: 23%, up from 17% in Q4 2023 (highest since records began)
- Credit cards: minimal usage
- Electronic payments or SPEI transfers: minimal usage
- CoDi: minimal usage
Reasons for Cash Usage
The primary reasons for using cash, according to the study results, are that people find it more practical, easy, and fast (54% of responses, up from 45% in Q4 2023).
- Cash is the only available payment method: 16%
- Perceived as more secure: similar percentage
Potential Improvements Without Cash Usage
Despite the high cash usage, respondents believe there would be improvements if cash were no longer an option.
- 51% believe tax evasion would decrease
- 40% think corruption would decrease
- 20% estimate a decrease in drug trafficking
- 10% believe nothing would change, and fraud would increase
Groups Most Affected by Cash Reduction
The population also believes that certain groups would face difficulties if cash were no longer an option, including low-income individuals, older adults, rural residents, those with limited internet access, people with disabilities, and merchants.
Push for Reduced Cash Usage
The Association of Banks of Mexico (ABM) plans to focus on reducing cash usage and promoting financial digitalization in the coming years, according to its new president, Emilio Romano.
- Limit high-denomination banknote emission
- Simplify tax and social security compliance schemes
- Digitalize government (federal and local) transactions
- Encourage businesses and large companies to operate digitally with clients and suppliers
- Merge existing digital payment platforms into one
Key Questions and Answers
- What percentage of the population still uses cash for daily transactions in 2024? 96%
- What payment method saw the highest increase in usage from Q4 2023 to Q4 2024? Debit card usage increased from 17% to 23%
- What are the primary reasons people prefer using cash? Practicality, ease, speed, and perceived security
- What improvements do people anticipate if cash were no longer an option? Decreased tax evasion, corruption, and drug trafficking, though some believe nothing would change
- Which groups would face difficulties if cash were no longer an option? Low-income individuals, older adults, rural residents, those with limited internet access, people with disabilities, and merchants
