Paying For Stuff In Lake Chapala
Many visitors to Lake Chapala who are used to paying for their groceries or restaurant meals with credit cards will be totally surprised to discover that in most places, credit cards are not accepted. There are exceptions, of course, like Walmart or the larger liquor stores such as La Paz or Vinos Americas but in general it a cash society.
In this blog article we'll look at the common ways of buying and paying for stuff in Lake Chapala, Mexico.
Cash is King
For starters, as a tourist, bring your debit card. There are lots of ATM machines available – including an ATM that gives you USD cash - although at times (particularly during holidays) the machines are out of cash. Once you live here under a temporary or permanent visa, you can open a peso bank account to keep some money handy. I say “some money”, keeping in mind that you may not want to exchange very large sums into pesos given the peso devaluation over the years. Once you select a bank and open your account, the amount you can withdraw from the teller or their ATM can vary.
We are clients of the smaller, but service oriented Intercam bank, where the allowed daily withdrawal is 20,000 pesos at the teller and 5,000 pesos at the ATM. Recently Intercam offered us Visa Debit cards which technically allow us to take out up to 100,000 pesos. I say “technically” because the cash can run out even at the bank. For larger purchases, you'll need to order the money a couple days before. Banks only bring in so much per day which is insured against theft. So in order to keep insurance costs down they only bring in a what they expect to release that day.
Recently I needed a new car tire. Since I wasn't happy with the prices I was quoted at Lakeside I started shopping on MercadoLibre.com.mx, a hugely popular internet market in Mexico. I found the tire at a 600 pesos savings, so I ordered it. Payment was made through OXXO, another hugely popular convenience store in Mexico which accepts payments for a number of businesses, including giants like MercadoLibre, cellular phone companies, electrical company, and most recently, Amazon.com.mx. After ordering my tire and upon arriving at OXXO to pay, I gave the teller the 'request number' for the amount I needed to send. To my pleasant surprise, all the information was already in their system and the payment was made directly into the seller’s business account. The transaction was quick, simple and efficient.
If you wonder how this payment system came about, it’s because many people in Mexico don’t have a bank accounts so they cannot make direct payments.
For large payments (more than 50,000-100,000 pesos) such as one we made recently to a contractor hired to performing a special job on the site of our new house, you can make a domestic wire transfer (SPEI) from the bank for 10 pesos + 16% IVA tax. This will require sitting down with a bank associate who needs the payee’s name and account information, plus the “CLABE” or SWIFT number of the receiving bank. This process will take 10-15 minutes, it’s traceable and safe and all that’s required at the end is your confirmation signature.
Wrap Up and a Personal Story
Discounts are many times offered for cash payments - or perhaps it's more accurate to say that if you pay by debit or credit card, you'll need to pay a service fee. Therefore, it’s good to have access to large sums of money whenever beneficial. Planning is key in order to avoid disappointments but you still need to be flexible in Mexico and accept “what is”, such as days without any cash at the teller because the money truck did not arrive.
Case in point with our last shopping trip to Guadalajara on a Thursday when my partner and I found some tiles that we wanted to buy for our new home. The deal was “cash only” and the “sale” lasted until the next day, Friday. So Friday morning we went to our bank to withdraw a large amount of cash. The teller refused us saying that they could only release to us ½ the amount we requested because they only had so much money available for the day. We left the building with half the amount. Our bank manager happened to overhear the transaction and intervened to help us take out the full amount instead of the suggested half amount . Needless to say, we felt very grateful for the manager’s attention! Moral of the story? Be nice and kind to everyone, including the bank tellers and managers. In the 9 years I’ve lived here I learned over and over again that local people will do everything possible to accommodate our requests and needs. The least I can do is to smile, be pleasant and be kind myself - and on occasion – accept that they are simply unable to help.
Thank you for reading this blog. If you have any questions about retiring to Lake Chapala then please drop me a line. I'd love to hear from you!