Mexico's tortilla producers, often overlooked by the banking industry, are beginning to break new ground thanks to financial technology. The Mexican National Tortilla Council, alongside tech company Finsus, has rolled out a mobile application aimed at revolutionizing the way these vendors conduct sales. The app allows businesses to accept payments through credit cards, QR codes, and even customers’ phone numbers. "It’s revolutionizing the industry," said Homero Lopez Garcia, president of the National Tortilla Council. He dreams of having 90% of tortilla makers using the app within the next three years.
The feedback from early adopters has been encouraging. Many have expressed satisfaction with the new technology, stating, "I like it, I understand it," according to Lopez Garcia. This innovative tool could also enable tortilla vendors to diversify their income by offering services such as mobile phone top-ups and bill payments – options previously not available to them. For many vendors, this app signifies their first real connection to the formal financial system.
Though Mexico is home to around 129 million residents, only about half of them hold bank accounts. The majority of tortilla shops, which number between 110,000 to 135,000 across the country, operate on the fringes of the economy, often using cash exclusively. Analysis from the Mexican statistics institute INEGI indicates around 18,000 tortilla shops are based in Mexico City alone, yet only 10% of these businesses are legally registered.
A significant reason many tortilla producers shun the formal banking system is rooted in their trepidation surrounding regulatory complications and debts. A 2021 survey by the Mexican National Banking and Securities Commission highlighted this tendency, showing 64% of Mexicans still prefer cash transactions over debit or credit cards. This preference only amplifies the gap between informal and formal financial practices.
Take the case of Abel Garcia, a seasoned tortilla producer with 25 years of experience. Early on, he relied solely on family savings after struggling to secure bank loans. His perseverance eventually allowed him to establish several outlets. “It was difficult to get credit — very, very difficult!” he recounted from his store located in the working-class district of Iztapalapa. While his business flourished, continuous distrust of banks remained, leading him to disregard more traditional banking options. "That’s why we tore up the checkbook,” he explained.
Each day, tortillas are consumed by millions of people, piping-hot and fresh, linking the country's culinary culture directly to informal businesses. Yet, the marginalization of these vendors from proper banking systems has excluded them from capitalizing on potential opportunities for growth. Many feel stuck without the necessary access to credit and services.
For Maria Adelaida Francisco, who labors at one of the tortilla shops, using the new financial application marks a significant shift. At 40 years old, she had never interacted with financial apps before her employer, Jorge Ramirez, introduced her to it. Now she easily pays her electricity bills through the app.
Some tortilla producers remain hesitant about fully engaging with banks. They often fear paperwork, debt, or unwelcome scrutiny from tax officials. “They’re a bit scared of the tax issue, or they don’t know about it,” Ramirez noted, highlighting the knowledge gap many face. He has seen several of his eight employees start using the application to collect their salaries, which speaks volumes about the changing dynamics.
This move toward embracing financial technology reflects larger trends sweeping through Mexico, the second-largest economy in Latin America. A recent study conducted by the Inter-American Development Bank alongside the venture capital firm Finnovista pointed out Mexico's notable footprint, capturing 20% of the region's fintech ventures – second only to Brazil. Between 2017 and last year, the number of fintech startups surged over fourfold, reaching 3,069 across Latin America and the Caribbean.
Despite these promising developments, the financial inclusion experienced by tortilla makers remains alarmingly low. Lopez Garcia was candid about the obstacles, stating, "The banks don’t believe in the industry." His words encapsulate the deep-seated challenges faced not only by tortilla producers but by many informal workers across the nation who find it challenging to connect to formal financial markets.
What this means is, as they revolutionize their businesses with new technologies like the Finsus app, these tortilla producers are pushing against years of exclusion from Mexico's formal economy. While the transition may be fraught with difficulties and cautious optimism, the very act of integrating technology functions could pave the way for more sustained growth and easier access to financial resources.
Facilitated by innovative approaches, many tortilla businesses might soon become part of the broader economic fabric, which – up until now – has largely been held together by cash transactions and informal practices. With persistence, they could not only modernize their operations but also work toward achieving the financial recognition and respect they’ve so long desired. This digital leap could eventually redefine not only their livelihoods but the economic status of informal businesses throughout the country.
Looking toward the future, it remains to be seen how this financial technology wave will continue to evolve and whether the initial apprehension from many entrepreneurs will give way to greater financial integration and empowerment. The backbone of Mexico’s staple food may soon find itself at the forefront of the financial revolution.
