Mexican immigrants are gaining unprecedented access to American financial services after U.S. banks agreed to accept Mexican consulate identity cards as a legitimate identification for opening bank accounts. The result has been a boom in business for the banks and increased security for immigrant workers. Other Latin American consulates are now seeking to follow Mexico's example.
There are more than 35 million Hispanics living in the United States. More than 60 percent come from Mexico. One out of two lives in California and Texas.
But until recently, most of them lacked the required two pieces of identification to open bank accounts or use banking services to wire money home to their families.
Mexican Consulate spokesman Agustin Pradillo in Los Angeles says millions of Mexicans who could not meet the requirements were forced to find other ways to protect their savings or wire money back home.
"Millions of Mexicans tried to put the money behind [under] the mattress or in the shoes or in the pockets," he said. "They tried to protect the money but they suffer a lot of robberies and problems, not only in the streets but also in the companies to send the money because they took high rates in the exchange banks and services."
That all changed late last year when Wells Fargo Bank agreed to open its doors to the Mexican immigrant community.
"It originated in Austin [Texas]," explained Wells Fargo spokeswoman Miriam Galicia Duarte. "Wells Fargo was approached by the police department to partner with the police and Mexican consulate to establish accounts for Hispanics who were being robbed and victims of crime in Austin."
After six months of negotiations, Wells Fargo agreed to accept the identification cards provided to Mexicans by the consulate - the matricula consular, as it is known in Spanish. The ID card has a magnetic stripe and a hologram to make it more difficult to falsify.
More than 30 other bank networks now are following Wells Fargo's example. Several U.S. cities also have agreed to accept the card as proper ID to gain access to public services.
As a result, Mr. Pradillo says the demand for consular IDs has more than doubled. "Last year [the total] was 75,000 and only in the first three months [of this year] it was 47,000 matriculas," he said.
Wells Fargo spokeswoman Galicia Duarte says business is booming for the banks, too. Wells Fargo has opened 25,000 new accounts since the program was launched seven months ago. Since then, migrants have deposited more than $50 million in California bank accounts alone.
"And we're talking about folks who probably never had a banking relationship before and who are now just learning the basics of financing what is credit, the difference between checking and savings, how to use ATMs [bank cash machines] and how to wire money without going to outside companies and paying high fees," she said.
U.S. banks now are also tapping into the Mexican wire transfer trade, which totaled more than nine billion dollars last year.
Immigration advocates like Eric Rodriguez of the National Council of La Raza says it's about time U.S. industry opened its doors to the immigrant market.
"There's hope that if you open the doorway to some extent that this will lead to greater products and benefits for the broader community overall," he said. "It took a few companies out there to say there's a real market, a real potential and now everyone else is falling into line."
Several other U.S.-based Latin American consulates, including El Salvador and Guatemala, are seeking to set up similar programs.