The Pros & Cons of Getting a Mexican Credit Card in Los Cabos

Americans and Canadians who buy property and live at least seasonally in Los Cabos will find all the beaches, sunshine, margaritas and ocean views they’ve ever dreamed of, but along with this natural bounty and muy atractivo lifestyle comes a few cultural changes.

Language is the most obvious one, although so many people speak English in cape cities Cabo San Lucas and San José del Cabo that’s it rarely an issue, even for those whose Spanish vocabulary is limited to “Buenos días” and “Como está usted?”

More commonly, miscommunications involve financial transactions; from exchange and interest rates to bank statements and credit card disputes. Nobody, after all, wants there to be any confusion or incomprehensible fine print when it comes to their bank account or credit cards.

Which leads to the very good questions:  Do you even need a Mexican bank account or credit card in Los Cabos? What are the pros and cons?

The Pros

There are very good reasons to open a bank account in Los Cabos if you intend to spend an appreciable amount of time in the area, starting with the fact that you can trade dollars for pesos–and vice versa–without a questionable exchange rate or service charges. U.S. dollars are accepted everywhere in Los Cabos, but many area businesses set their own exchange rates, meaning it’s preferable to pay in pesos to avoid being overcharged.

U.S. credit cards are accepted virtually everywhere, too, so why add to your U.S. collection with a Mexican credit card? The truth is that those who intend to maintain a presence in their country of birth–property, bank accounts and the like–likely do not need a Mexican credit card (In Spanish, tarjeta de crédito).

However, if you intend to move seasonally or full-time to Los Cabos, then it will be handy to have a Mexican debit card that you can use to access money from ATMs (in Spanish, cajeros automáticos), pay bills and utilities, make retail and online purchases, and so on. You may also want a credit card–particularly if your U.S. issued card charges foreign transaction fees–but as we’ll discuss in the “Cons” section below, there are definitely some issues to consider. The safest and best bet is thus to go debit card only.

Just keep in mind that you will need a residente card and proof of residence to open a bank account, and that bank to issue you a debit/credit card. If you deposit several thousand dollars or the equivalent in pesos into your new account, banks will usually be happy to issue you a credit as well as debit card. These cards are issued in conjunction with Visa or MasterCard, but in case of loss, theft or fraud, you will need to make the report to your Mexican bank rather than the multinational credit card company.

The Cons

Speaking of theft and fraud…those two issues do occur in México–as they do in every country–and are particularly prevalent in popular tourist destinations like Los Cabos.

Restaurants and gas stations tend to be the places where credit card information is stolen with a higher frequency, so make it a point to pay cash in those instances and it will significantly reduce your risk profile.

If you are a victim of fraud, remember that most Mexican banks maintain 24-hour hotlines to report loss or fraud. Keep the hotline number handy, and if you don’t speak Spanish, at the very least you should be able to ask the operator to transfer you to someone who speaks English. You can do that by saying, “¿Puede transferirme a una persona que habla inglés, por favor?”

Fraud isn’t limited, however, to credit card thieves. Many U.S. and Canadian transplants have reported issues with bank fraud in Los Cabos, from unilaterally hiked interest rates on credit cards to limited liability in covering losses from stolen card charges.

Exorbitant interest rates and annual charges are also things likely to cause consternation to first-time holders of Mexican credit cards. Make sure you understand the terms before you accept a credit card from your bank, and check charges on a monthly basis. You do not want to be paying interest rates that may be in excess of 30%.

It sounds bad and sometimes is, but keep in mind there are ways to mitigate or limit issues with Mexican banking. The first is to eschew credit cards in favor of debit cards, since the former may require paying back fraudulent charges until the claim is resolved. Lost or stolen debit cards are harder for thieves to use, since they likely won’t have access to the PIN number, although it should be noted that debit cards can often be used for point-of-sale purchases.

Even more important is finding a bank where you feel comfortable with the communication skills and customer service quality. The local branch of Canadian owned Scotiabank, for example, is popular with many U.S. and Canadian transplants for these very reasons.

Banking services may not rival beaches, sunshine, margaritas and ocean views as reasons to move to Los Cabos, but be vigilant and aware of potential fraud and it won’t be a reason not to move.

Windermere is one of the most respected names in North American real estate, with over 300 offices and 6,000 agents in the Western U.S. and México. The company has deep roots in Los Cabos, where its agents have over 100 years of collective experience, as well as an exhaustive knowledge of available local listings and the intricacies and legal requirements of buying and selling property in México.

Windermere is the ally you want when it comes to finding your next home.

Call us from the USA / Canada at 011 52 (624) 228-3509 for more details. Don’t let your dreams wait…  We’ll help you find and buy your dream home in Los Cabos.  Contact Us today