Circular 2/2017 — Modifies Circular 22/2010

Tuesday, February 14, 2017 OFFICIAL GAZETTE (First Section) 10

CIRCULAR 2/2017 directed to Credit Institutions and Multiple-Objective Financial Companies Regulated, regarding Modifications to Circular 22/2010 (Basic Accounts for the General Public. Dispersal of Subsidies).

At the margin a logo, which says: Bank of Mexico.

CIRCULAR 2/2017

TO THE CREDIT INSTITUTIONS AND MULTIPLE-OBJECTIVE FINANCIAL COMPANIES REGULATED:

SUBJECT: MODIFICATIONS TO CIRCULAR 22/2010 (BASIC ACCOUNTS FOR THE GENERAL PUBLIC. DISPERSAL OF SUBSIDIES)

The Bank of Mexico, with the purpose of continuing to promote the sound development of the financial system and the protection of the interests of the public, taking into account the benefits of basic accounts for the general public offered by credit institutions, has considered it convenient to establish additional conditions to the aforementioned basic account with the object of flexibilizing its operation for the dispersal of government subsidies and, in turn, to foster the incorporation of beneficiaries of government subsidies into the financial system.

For the above, based on articles 28, paragraphs sixth and seventh, of the Political Constitution of the United Mexican States, 24 and 26, of the Bank of Mexico Law, 4, 4 Bis and 22, of the Law for Transparency and Ordering of Financial Services, 48 and 48 Bis 2, of the Credit Institutions Law, 4, paragraph first, 8, paragraphs fourth and seventh, 10, paragraph first, 14 Bis, paragraph first, in relation with 17, fraction I, 14 Bis 1, paragraph first, in relation with 25 Bis 3, fraction II, of the Internal Regulations of the Bank of Mexico, which grant it the authority to issue provisions through the General Legal Direction and the General Direction of Financial System Affairs, respectively, as well as Second, fractions I and X, of the Agreement on the Assignment of Administrative Units of the Bank of Mexico, has resolved to modify numerals 1, in the definitions “Basic Payroll Account” and “Basic Account for the General Public”, 2.22. and 2.24., as well as add to numeral 1 the definition of “Resource Provider” and a numeral 2.25., to the “Provisions of a general nature that establish prohibitions and limits on the charging of commissions”, contained in Circular 22/2010, to remain in the following terms:

PROVISIONS OF A GENERAL NATURE THAT ESTABLISH PROHIBITIONS AND LIMITS ON THE CHARGING OF COMMISSIONS

1. DEFINITIONS

…

…

“Basic Payroll Account: the account corresponding to the bank deposit of demand or savings funds relative to payroll referred to in the first paragraph of article 48 Bis 2 of the Credit Institutions Law.”

“Basic Account for the General Public: the account corresponding to the bank deposit of demand funds referred to in article 48 Bis 2 of the Credit Institutions Law.”

…

“Resource Provider: that person who, without maintaining a labor relationship with the holder of a Basic Account for the General Public, regularly credits to said account resources corresponding to programs provided by government instances.”

Tuesday, February 14, 2017 OFFICIAL GAZETTE (First Section) 11

…

2.2 BASIC ACCOUNT FOR THE GENERAL PUBLIC

…

2.22. “Basic Accounts for the General Public may be opened in the name of natural persons who meet the requirements established by the applicable regulations for the celebration of the corresponding contracts for bank deposits of demand funds, who may request such opening directly or through an attorney duly authorized for that purpose. Under no circumstances may credit institutions establish requirements for the opening of Basic Accounts for the General Public that limit, modify or in any way render null and void what is provided in these Provisions for that effect.”

…

2.24. “Each credit institution may determine a single minimum average monthly balance that, in its case, must be maintained by any Basic Account for the General Public that such institution must offer. In the event that, over a period of three consecutive months, the average monthly balances of any of the aforementioned accounts are lower, in each of said months, than the minimum established in accordance with this paragraph, the credit institution may close such account in accordance with what is stated in this numeral.

In the case of that Basic Account for the General Public in which periodic deposits are made by a Resource Provider that the respective credit institution has identified in terms of numeral 2.25 below, such institution may only establish, as a condition to keep that account open, that, during a period of six consecutive months, at least one of such deposits is made to that account, provided that it is identified as such by the institution itself in accordance with the cited numeral, without it being required that during that period it maintains the minimum average monthly balance referred to in the previous paragraph.

For the purposes of what is stated in the previous paragraph, the credit institution that maintains the Basic Account for the General Public referred to and that has contemplated it in the deposit contract corresponding, may close it once the six-month period referred to in that same paragraph has concluded during which none of the deposits indicated in said paragraph have been made and that, in addition, during the three consecutive months following the end of that six-month period, the average monthly balances of said account corresponding to each of those three months are lower than the minimum that such institution establishes in accordance with the first paragraph of this numeral.

For the purposes of the scenarios provided for above in this numeral, when the average monthly balance of a Basic Account for the General Public has been lower, in any month, than the minimum that the credit institution in question has established in accordance with the first paragraph of this present numeral, such institution must notify the respective account holder that this may close the account in case that, during each of the two immediate months following that aforementioned month, the average monthly balance of that account is lower than said minimum balance. The credit institution must carry out the notification referred to in this paragraph by: a) Written communication addressed to the account holder at the address this has provided to the credit institution for the purposes of its respective account, which may be included in the account statement corresponding to the month in which the average monthly balance of said account has been lower than the minimum referred to, provided that it is delivered during the month immediately following; b) Notice on the automatic teller machines that the account holder may use to check balances or make transactions in that account, provided that such notice is generated automatically by the credit institution's systems configured to appear, in a clear and conspicuous manner, on the screen immediately after the account holder types their personal identification number, and that they use the automatic teller machine during the first thirty days following the month referred to, or c) Text message sent to the mobile phone number that, if applicable, has been associated with the Basic Account for the General Public in question, in accordance with what is disposed by article 17, fraction I. (C), of the Provisions applicable to the operations of credit institutions and of the National Financial Institution for Agricultural, Rural, Forestry and Fisheries Development included in Circular 3/2012, issued by the Bank of Mexico, in terms of the modifications to said provisions issued subsequently.

When notifications are made through the means referred to in this subsection, the respective credit institution must obtain through that same channel the confirmation that the user of the respective telephone equipment is the holder of said account and that they are aware of said message.

In the event that the notification has not been made in accordance with subsections a), b) or c) above within the timeframes indicated in them, the credit institution must carry out the notification, within the first fifteen days of the second month following that in which the account in question has maintained an average monthly balance lower than the minimum established in accordance with the present numeral, to the Client through written communication delivered at the address indicated in subsection a).

When the credit institution closes the account, it must return to the Client the resources that are maintained deposited in it, either by delivering cash at the counters of its branches or by making a check payable to them available, as established in the respective contract.”

“2.25. Credit institutions must identify the deposits they receive from Resource Providers in terms of the previous numeral by: a) One of the following identification data of fund transfers: (i) the tracking key, or (ii) the reference key that, for such effect, the Resource Provider has made known to the respective credit institution, or b) Any other mechanism that, for such effect, the credit institution in question has agreed with the respective Resource Provider.

Credit institutions must keep a record in their systems of the identification mechanisms for the deposits they use in terms of the previous paragraph.”

TRANSITORY

UNIQUE. This Circular shall enter into force on August 10, 2017.

Mexico City, February 9, 2017.- The General Legal Director, Luis Urrutia Corral.- Signature.- The General Director of Financial System Affairs, Jesús Alan Elizondo Flores.- Signature.

Tuesday, February 14, 2017 OFFICIAL GAZETTE (First Section) 13

For any queries regarding the content of this Circular, please contact the Department of Authorizations, Consultations and Legal Control, at the phones (55) 5237-2308, (55) 5237-2317 or (55) 5237-2000 Ext. 3200.