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Monday July 05, 04:01
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Citigroup Now Offering A Cross-Border Credit Card
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Citigroup is enabling its Banamex USA credit cardholders in the US to share their lines of credit with family or friends in Mexico in a bi-national program for which cards will be issued by California Commerce Bank, the US-based banking arm of Citigroup’s Banamex unit. Holders of the cards will be able to pay bills in US dollars, while those in Mexico can pay in pesos, and cross-border remittances are simplified. US-based credit cardholders will receive Banamex USA cards and monthly statements for both cards, with cardholders in Mexico receiving Banamex cards and statements showing only their billing activity.
Further cross-border banking partnerships could result from a recent meeting between four major US banks and Mexico’s President Vicente Fox, who is now permitting banks to market their products through all Mexican consulates in the US. Remittances to Mexico, a cash flow second only to oil sales in terms of foreign revenue, are a priority for President Fox, and US banks are keen to grow their 3 per cent share of the 40 million transfers from the US to Mexico in 2003. Banks however have to compete with remittance service providers to promote their services within the estimated USD 10 billion to USD 25 billion market.
Mexican nationals working in the US have traditionally used ‘mom-and-pop’ remittance services to send money home, but US banks are hoping that Fox’s push to extend financial services to Mexicans in the US, will increase their customer base. Individuals with the matricula consular (ID cards from Mexican consulate offices) can open bank accounts for remittances, and Wells Fargo has 400,000 accounts opened with such cards. One potential hurdle for Mexicans using remittance services is that banks’ fees may be cheaper, but related exchange and monthly account fees also have to be factored into the cost.
(Business News Americas)
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