Mexico Moves to Cap Card Fees; Sector Flags Inclusion Risks

The National Banking and Securities Commission (CNBV) and Mexico’s Central Bank (Banxico) have opened a public consultation on new general provisions to regulate payment networks, with the core proposal focused on establishing maximum limits for interchange fees. The initiative aims to update and strengthen the regulatory framework by guaranteeing interoperability, transparency, and security in the country’s payment systems, in line with the Law for the Transparency and Ordering of Financial Services.

Interchange fees are the commissions paid by the acquiring institution (the entity that affiliates merchants) to the issuing institution (the card administrator) for each card transaction.

The proposed caps are 0.3% for debit card transactions and 0.6% for credit card transactions—significantly lower than current variable tariffs, which are reportedly around 1.91% for credit cards and 1.15% for debit cards.

Industry Concerns Over Economic Impact and Innovation

The regulatory proposal has raised concerns among industry experts about potential negative effects on financial inclusion and innovation.

Lisset May Cervantes, Senior Vice President of Sales, Kueski, argued that the measure risks weakening the very ecosystem it aims to strengthen. “The idea is that if we lower the interchange rate, more small merchants will accept terminals. But this only addresses the symptom. We are not solving the root problem,” she said.

Cervantes noted that while reducing costs may convince some informal merchants to adopt card terminals, focusing solely on merchant expenses ignores the broader network of incentives required for digital payments to thrive.

Álvaro Vértiz, national director, DGA Group, added that setting maximum caps could discourage innovation and ultimately undermine the policy’s goals. “The proposed amounts are extremely aggressive,” he said.

Experts submitting comments to the National Regulatory Improvement Commission (Conamer) warned that lowering interchange fees could lead some institutions to scale back operations or deprioritize unbanked populations. Many argued that issuers may compensate for lost revenue by raising other charges, such as interest rates and service fees. A study by the Payment Methods Association (Asamep) noted that international evidence shows fee reductions often benefit large merchants without translating into consumer savings.

Incentives, Infrastructure, and Regulatory Burden

The financial sector acknowledged the government's objective of reducing cash usage and accelerating digital adoption, but argued that any reforms must preserve balanced incentives. The Mexican Banking Association (ABM) emphasized the crucial role card issuers play in financial inclusion and consumer credit.

Cervantes pointed to the limited adoption of CoDi, the QR-based instant payment system, as an example. When regulators removed interchange revenue, issuing banks and networks lost incentives to invest in distribution, education, and fraud-prevention infrastructure. As a result, CoDi saw low merchant uptake and minimal consumer adoption, leaving the system without a sustainable economic model. She warned that the same could happen if interchange fees are reduced too sharply.

Emilio Romano, president, ABM, presented a counterproposal to authorities, advocating for a gradual fee reduction and the creation of a zero-rate category for new establishments. This “zero-rate” approach aims to prevent commissions from becoming a barrier for merchants entering the formal economy.

Payments Integration and Trade Implications

The ABM also recommended pairing interchange-fee reductions with structural improvements to the Interbank Electronic Payment System (SPEI). Romano proposed integrating CoDi and Dimo—an instant payment system using phone numbers—to create a more efficient alternative to credit and debit card transactions.

The proposal is also being reviewed in the context of the United States-Mexico-Canada Agreement (USMCA). Vértiz warned that new barriers to entry in Mexico’s payments ecosystem could affect international players such as Visa and Mastercard, potentially triggering USMCA discussions related to competition and market access. The proposed framework also expands supervisory powers for both the CNBV and Banxico.

Separately, the ABM and the Mexican Council of the Consumer Products Industry (ConMéxico) signed an agreement to promote the digitalization of micro, small, and medium-sized enterprises (MSMEs). Romano noted that this effort aligns with Plan México, which aims to ensure that at least 30% of MSMEs have access to formal credit by 2030. The share of banked MSMEs has already increased from 24% to 26.5% in recent months.