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 Business News | May 2005 
Money Transfers To Mexico Peak As Mother’s Day Nears
 Rosa Salter Rodriguez - The Journal Gazette
| | Nearly one in five adult Mexicans gets some remittance income, according to the center. |
This month brings Mother’s Day – a big day for flower shops, jewelry sellers and restaurants.
And for another kind of business as well – money transfers from the United States to Mexico.
Each week, millions of Mexican immigrants and Americans of Mexican heritage, send money to family members living across the border.
The transfers tend to peak around Christmas and Mother’s Day, which is celebrated in Mexico with great enthusiasm on May 10 every year.
Unlike in the United States, where Mother’s Day gifts tend to consist of life’s little luxuries, the money sent to Mexico generally isn’t spent that way.
“Most of the time it goes for basics – housing, food, clothing, education. A lot goes for better education,” says Rosa Gerra, director of the Benito Juarez Cultural Center in Fort Wayne.
She says the number of Hispanics in Fort Wayne and Allen County has risen to 17,000, according to the most recent U.S. Census figures.
And, as the number of people of Mexican origin living in the United States swells, the amount of money quietly flowing over the border is beginning to attract more attention.
Last year, according to reports by the Pew Hispanic Center in Washington, D.C., and the Inter-American Development Bank, Mexico received at least $16.6 billion in remittances, as the money from abroad is formally called – although no one really knows how much cash travels without benefit of financial institutions.
The amount has nearly doubled since 2000, and these days, nearly one in five adult Mexicans gets some remittance income, according to the center.
Meanwhile, four of every 10 foreign-born Hispanic adults living in the United States regularly send some money home. Two-thirds of those people send money once a month or more. Last year there were 50.9 million transfers to Mexico averaging $327 each.
The money comes from people like Claudia Chavez of Fort Wayne, who smiles from behind the cash register at her job at George’s International Market on Broadway.
“The money from first payday is for me. The next is for my mom,” says the 28-year-old, who has been in the United States for about seven years.
She has helped support her mother, Maria Del Carmen Hernandez of Cuernavaca, near Mexico City, since her mother became a widow five years ago.
Chavez says the money she sends goes to pay for Catholic school for her sister Yessenia, 14, so she will be able to graduate from high school.
Her mother works as a cook and her other sister is a student and also works part-time.
“But it is hard for them,” she says.
Felipe Soria of the Mexican consulate in Indianapolis says remittances reflect the strong family ties and more communal lifestyles in Mexico, where members of extended families share what they have to a greater degree than typical Americans.
“Mexicans are very serious in their relationships. Family ties are very important,” he says. “Mexicans (in the United States) send money to relatives (in Mexico) for purchasing power, to get goods or to develop a ranch or a small business for the family, or for building a house, something like that, to have a better way of living.”
Sister Joan Hastreiter, who works with Mexican-American migrants in the Warsaw area, says the ability to send money home for many is a mark they’ve succeeded in America.
“They do it not just for self-satisfaction, but pride in being able to take care of their families,” she says.
In Fort Wayne, the proliferating money transfer trade can be seen at supermarkets and convenience stores patronized by the Mexican-American community.
Signs proclaim “Envios dinero!” (Send money!), and businesses openly advertise on the basis of price per dollars sent – “$10 any amount” reads one sign at a store along Hessen Cassel Road.
Inside the businesses, a computer terminal usually facilitates the transfers, as people line up to hand over cash, sometimes hundreds of dollars at a time.
At George’s, clerks perform about 30 money transfers a week to Mexico and other Latin American countries such as El Salvador and Guatemala via Western Union, according to Jerry Rongos, a store manager.
“I had (a friend) drop by the other week and say it’s like a mini-bank in here,” he says. “Mother’s Day will be really busy.”
Western Union’s service costs $10 for up to $500, he notes, and a premium service that advertises “Money in Minutes” costs $5 more.
Soria says when people ask about money transfers, “We suggest and recommend that people use the bank they usually use to wire money to Mexico. ... What we recommend also is that people open a bank account and get two cards, one for themselves and one for the person in Mexico to use. That’s the least expensive way.”
Gerra says some banks use their ability to send money as a way to attract Hispanic customers, many of whom don’t use banks, to open savings and checking accounts.
Such an ad from Wells Fargo recently appeared in El Mexicano, a Fort Wayne-area bilingual newspaper.
Wells Fargo offers an Intercuarto (Inter-Account) Express service, so deposits made here can be sent to Mexican banks. It also offers a debit card that can be used at ATMs in Mexico, and can arrange for automatic transfers across the border. The fees can be less than the cost of frequent single transfers.
Gerra says she usually recommends people use the U.S. Postal System’s Dinero Seguda (Safe Money) system because it’s convenient and inexpensive and safer than informal channels.
But according to the Pew Center, the overwhelming amount of money nationally is sent through small services, many operated by immigrants themselves. They usually pay a fee to start but also get a cut of the transactions to supplement their other business income.
Those performing transactions can make money in several ways, says Carolyn Stumph, an Indiana University-Purdue University Fort Wayne professor of international economics with a specialty in the Mexican economy.
Financial institutions can charge for the service itself, offer less than the current exchange rate to those making transfers and hold various nations’ currencies and time transfers in ways most favorable to them
Overall, sending money has become cheaper in the last five years, and lawsuits against major services have resulted in more and clearer disclosure of fees, according to the Pew Center.
Still, Gerra says most customers choose which service to use by what’s in their neighborhood or word of mouth, and many aren’t sophisticated enough to know how to get the best deal.
Indeed, she says many Mexican migrants don’t even talk about sending money home. “They don’t want people to know they have a poor family,” she says, or they just consider their finances private.
Some may fear that they won’t be hired by Americans if they knew that the money earned would be sent out of the country. Others may think they’ll be seen as old-fashioned or not really “American.” Still others don’t say anything out of fear their immigration status will be found out or that they will become victims of crime if it’s known that they are saving or carrying cash to send.
Nonetheless, the practice continues, and even persists into the second and third generations of immigrant families, Gerra says.
“This is not something that’s temporary,” she says. “It’s for life, until your mother dies or your father dies.”
Meanwhile, Chavez doesn’t have a car and is sharing an apartment to cut her expenses so she can send money home.
She says she doesn’t go out much, and is “always looking for ways” to save.
For Mother’s Day this year, she says, she will probably send an extra $50 to her mom.
She smiles. “For Mother’s Day, I tell her, ‘Buy what you like.'” |
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