Saturday, June 15, 2024

State-operated Bank of Well-Being no longer receives remittances

The Bank of Well-Being (Banco del Bienestar) no longer receives remittances from other banks and institutions and plans to focus entirely on the diffusion of the government’s social welfare programs.

The public financial institution founded by President López Obrador in 2019 released a statement saying that since Feb. 28, it has stopped receiving remittances from other banks and remittance institutions abroad.

The bank will now focus exclusively on providing banking services to the beneficiaries of social programs and paying out benefits. (@bbienestarmx/Twitter)

A new government entity, Finance for Well-Being (Financiera para el Bienestar), has taken over receiving remittances. Director General of Finance for Well-Being Rocío Mejía Flores told El Economista that remittances are now the institution’s priority. 

In its statement, the Bank of Well-Being cites the 2019 Federal Republican Austerity Law that forbids duplication of functions between public entities.  

“After reviewing the bank’s status and based on the Federal Republican Austerity Law, which in its Article 13 expressly forbids the duplication of functions in the units that make up the Federal Public Administration (APF), the Bank of Well-Being has taken the decision to leave the remittances market.”

The public institution also denied allegations that U.S. bank Wells Fargo decided to stop providing its remittance services through the Bank of Well-Being over money laundering concerns, and that it was instead the Mexican bank that exited the market. The bank said it informed all remittance institutions it worked with in December of its decision.

According to reporting in Reforma newspaper, in September 2021, the head of the consumer protection agency (Profeco) had encouraged Mexican workers living abroad to use the Bank of Well-Being for sending remittances home. But a year later, López Obrador dismissed a question from the press about alleged bank fraud involving a migrant, saying that the Bank of Well-Being was not “receiving or distributing remittances”. 

The bank has stated that it will now focus on the government’s two main objectives: to provide banking services to the beneficiaries of social programs and the creation of the largest branch network in the country. Its goal is to reach 25 million Mexicans and to provide “every one of them” with a Bank of Well-Being card to easily access financial support. 

In February, López Obrador boasted that the bank would distribute 600 billion pesos (US $32 billion) in social programs throughout 2023 without charging a commission. The bank currently has 1,500 branches in operation, out of the 2,700 initially promised.

According to the Bank of Mexico, remittances reached an all-time record figure of US $58.5 billion dollars in 2022, a 13.4% growth compared to the previous year. 

With reports from Reforma, Banco del Bienestar and El Economista

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