Credit Cards for Small Businesses in Mexico | CompareRemit
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Best Credit Cards for Small Businesses in Mexico

Updated on March 25, 2022 11:04 am
send money to Mexico

Small businesses require access to multiple financial instruments to manage their day-to-day business expenses effectively. While both personal credit cards and business credit cards can give you access to lines of credit, business credit cards are recommended for business expenses even for small businesses. 

You do not need to be running multi-million dollar operations - you can open a business credit card to cover expenses for small businesses including freelance gigs, for-profit side hustles, etc.

Small business credit cards are designed to help finance businesses expenses, keep track of business purchases, and record transactions in a systematic manner. In this article, we will briefly discuss accessibility to lines of credit for small businesses and the best credit card offerings in Mexico. 

Accessibility to Line of Credit for Small Businesses in Mexico

Mexico lags behind other countries with similar development levels in terms of financial inclusion. Medium and small businesses provide 70 percent of the employment in Mexico, but only around 11 percent use bank credit due to lack of affordability and accessibility, according to the World Bank. 

SMEs are fundamental to Mexico's economy. It is estimated that there are 5 million registered SMEs and another 5 million non-registered businesses in Mexico. 

As per the Banco de Mxico records, of these, 25% have loans of some kind. Only 5% of these businesses are financed by big banks. Non-bank lenders serve 3% and 17% by alternative lending sources. This means 75% of SMEs in Mexico have no access to formal lending services. 

The COVID-19 crisis has only worsened the situation. In response to the economic shock, the Mexican government has dedicated more resources to improve business environments through innovative solutions such as providing better access to loans, higher subsidies, investing in financial technologies, and digitizing cross-border payments or the remittance sector. 

These investments have exponential benefits to the people, businesses, and the country. Take digitizing cross-border payment, for example, it has made the ability to send money to Mexico faster, cheaper, and more secure.

Read: Best ways to send money to Mexico

Why Should You Get a Credit Card for Small Business? 

Credit cards in Mexico are a good financing option for small businesses that do not have elaborate financial data sought by traditional banks for extending credits.

Most SMEs (small and medium-sized enterprises) struggle to get credit because of lengthy bureaucratic processes and excessive fees. 

The current Mexican banking system has left a huge percentage of companies underfunded. A small number of large corporations make up the majority of the bank's lending portfolios in Mexico. IMF data shows that 80% of the market share is controlled by the top seven banks (BBVA, Santander, Citi, Banco de Mxico, HSBC, Scotiabank, Banco Inbursa).

In the meantime, Moody's reports show that SMEs account for about 90% of businesses in Mexico but only represent 9% of total bank loans. This means SMEs in Mexico are underserved by the banking system, pushing them to search for credit from alternative sources. 

With banks only focusing on the top of the market and non-bank lenders (SOFOMs) being expensive (interest rates as high as 40%), Mexico's fintech sector is stepping up to bridge the gap and help in the growth of the SMEs by providing affordable and fast credit access. Neobanks such as Oyster Financial which we will discuss later in the blog is one such example.

Let's find out credit cards are the best for small business in Mexico.

Best Mexican Credit Cards for Small Businesses

Covalto American Express Credit Card 

Covalto American Express Credit Card is issued by Credijusto, a technology-enabled small business lender in Mexico and backed by i2C, a leading digital payment and banking technology provider. The card is supported on the American Express network. 

The Covalto American Express Credit Card is a first-of-its-kind corporate solution with digital onboarding. The card and financial software provide an innovative means for companies to control expenses, simplify financial management, and increase visibility into their business through a mobile application.

Features of Covalto American Express Credit Card

  • Digital-first corporate cards
  • Unlimited cashback
  • Next-gen security 
  • Fee and annuity free
  • 40-days financing
  • Purchase payment options of up to 5 monthly installments
  • Virtual card capabilities with a fully digital experience via the Covalto app 
  • Reduce onboarding times 
  • Immediate access to the credit lines

Mexican Business Visa Cards by Tribal Credit

Tribal Credit, a payment fintech, issues local business Visa cards in Mexico for SMEs looking for a better way to pay for business expenses and optimize their financial management, including cross-border B2B digital payments.

Their Mexican card issuance program allows customers to grow faster using higher credit limits and optimal interchange rates. Also, it frees SMEs from the shackles of local financial barriers imposed by traditional banks.   

Features of Mexican Business Visa by Tribal Credit 

  • Proprietary AI-driven approval process
  • Accepted Worldwide (anywhere Visa is accepted)
  • Zero-interest
  • Ten days to pay off your balance every billing cycle
  • Physical Corporate cards
  • Virtual Corporate cards: Create unlimited cards
  • Online access to the spending of teams

Jeeves-MasterCard Credit Card

Mastercard and Jeeves offer physical and digital cards to numerous Mexican businesses to help alleviate credit access problems in Mexico.

Jeeves is an all-in-one expenses management platform for global startups. It is the first expense management and banking entity approved to be Mastercard Principal Member in Mexico.

Jeeves claims to offer quick credit card approvals with no personal guarantees and is the preferred fintech among 700+ Mexican SMEs such as Runa, Monns, Bitso, Kavak, and many others.   

Features of Jeeves-MasterCard Credit Card 

  • Mobile-first
  • Hassle-free sign-up
  • Physical and Virtual cards
  • Record-time credit card approval
  • Ability to pay 30 days of credit in local currencies (wherever Mastercard is accepted) 
  • No fees & no transaction fees
  • No interest
  • Unlimited virtual cards for free
  • Up to 4% cashback 
  • No personal guarantees 

Konfo Visa Credit Card

Mexican fintech, Konfo, in partnership with Visa, offers a credit card to SMEs for whom poor credit lines stunts their business's growth potential.

Business owners can order the digital format of the credit card on Konfo's website and have access to a credit line within 6 minutes of approval. This is a lifesaver when funds are needed and fast. A physical card is then sent to the requester a few days later. 

The credit line offered depends on the business owner's financial behavior.

Features of Konfio Visa Credit Card 

  • Use card immediately after approval
  • Requirement: 25-75 years of age, three months billing, Valid ID
  • Spend and defer payments with a preferential rate 
  • Monthly purchase without interest 
  • Get discounts, payment facilities & Cashback with your purchases
  • Three additional cards at no cost 
  • Share spending & shopping responsibilities with your team
  • Monitor expenses and payments from the Konfo app
  • Get protection & coverage on trips & purchases by VISA
  • Annual cardholder fee (after one year of issuance): $1,250
  • Late payment fee: $500

Oyster Financial

Oyster Financial is a leading neobank for small and medium-sized businesses in Latin America.

Unlike most large banks and financial institutions in Mexico that don't serve SMBs, Oysters directly help small businesses to make or receive payments efficiently and optimize their operations via business-enablement tools. 

And it is focused on providing fast access to credit to small businesses that are the lifeblood of new jobs' creation for about 95% of private-sector jobs in Mexico.

Features of Oyster Financial 

  • A Cash-flow lifeline for many Mexican SMBs
  • Oyster is offering instant credit (between the US $500 -$1,500)* 
  • Revolving credit lines 
  • It is fast and free to sign up 
  • Actively engaged Oyster customers may be approved for revolving credit lines of up to US $5,000 within a few months of opening a new account.

*available to small businesses in Mexico upon opening an Oyster business account.

Bottom line

Business credit cards are worthwhile when operating a small business, especially in the early stages. It not only helps separate personal and business expenses and can help establish business credit so that it is easier and more convenient later on with loans and leases. You also get additional cards for your team members.

Mexico is the largest fintech hub in Latin America, slightly ahead of Brazil. No wonder fintech has begun to seize the opportunity to serve the significant unmet need of the SMEs in Mexico by bringing automation and tech-driven services to enhance access to financial services.

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