El Buen Fin ad from Liverpool
3 Months Interest Free!
This morning I was reading a post by Joanna, a fellow blogger who writes Writing From Merida, and she too was talking about El Buen Fin in the Yucatán. As Joanna spoke of the throngs of humanity, credit cards at ready, in the big box stores in Merida, I again felt that little niggle of fear.
It seems to me that up until a few years ago most Mexicans had not incurred much personal debt. I admit that I have spent more time in small towns than big cities but now, even in these areas I am seeing a disquieting trend towards the use of credit. The first thing you see upon entering most stores are signs offering free interest for a given amount of time. Next you will be greeted by a smiling face flogging a credit card for that particular retail outlet.
I was gratified to hear that my friend Rocío feels much the way I do about this growing trend. She was shocked when her cousin purchased a new car and entered into a seven year term to pay it off. I told her that this was pretty much standard operating procedure in the USA and Canada, but she was quite vehement in her opinion that this was a very bad thing. She had not even been aware that such agreements existed, which again led me to believe that the average smaller town Mexican has not, until recently, become entangled in the web of debt.
It used to annoy me when the Christmas decorations started to appear too early in Vancouver. Sometimes we would even see them before Halloween. I guess I just wasn’t ready to think about Christmas yet. This year they began to surface in Costco and Wal-Mart in Querétaro and Celaya in early September. I am uncomfortable with the retail industry’s push on the Mexican people to spend spend spend. Perhaps I am over sensitive as I am a refugee of that industry, but again, I feel that little niggle of fear.
I hope that the majority of Mexicans still feel, as Rocío does, that personal debt is a frightening thing to be avoided at all costs. Sadly however, I suspect that I am hoping in vain. I love Mexico and this growing trend toward a broad use of credit worries me a little. I even see credit cards being used in the grocery stores. I would hate to see Mexico go down the same financial road that brought the USA to it’s knees.
It is scary to watch when you know what is coming, isn't it?
ReplyDeleteThe other day I was waiting at the bus stop and a young lady handed me a promotion for a company which targets retired people for their borrowing program. I was truly shocked at this considering how small some peoples pensions are.
The interest rate was astronomical, something in the neighbourhood of 51 or 41 %. Unbelievable!! Reminded me of the company that used to be in Canada called "Avco" or something like that.
Anyway the young lady taped a notice on the door of a building by the bus stop and continued on her way.
Shortly, another lady came to wait for the bus and stopped to read the ad on the door. She sat down beside me and I asked her if she was interested. She kind of shrugged her shoulders and I showed her what it said in the "fine" print for the interest rate. Her eyes popped open and she shook her head in disbelief.
I don't think she will be sucked in; but how many will be?
Terrible, legalized robbery really.
That is really scary. I think part of what worries me is that a lot of people really don't know or understand what they are getting into. Companies like the one you mentioned have no conscience and are really dangerous.
DeleteHear hear! Well said!
ReplyDeleteThanks Peter. Things are changing here, as they are everywhere, and progress is inevitable. That doesn't necessarily mean that all change is for the good though.
DeleteYes! We must protect these Mexicans from themselves, for they know not any better. Not.
ReplyDeleteI certainly was not suggesting a need to save the Mexicans from themselves. Nor that they are not intelligent enough to make their own decisions. I was simply commenting on a societal change I see developing which could, as we've seen in the United States, have an unfavourable outcome.
DeleteI agree with you Shannon. The interest rates in Mx. ARE astronomical!
ReplyDeleteIndeed they are Barbara. It would be nice if we could all live well in a debt-free world, but that's not very realistic.
DeleteCredit is widely available in my village. And people are using it. I cannot speak of other regions of Mexico, but savings are very rare in our community. And there are a lot of reasons for that. Many of them historical. Credit has given some families access to products that would otherwise be out of their reach.
ReplyDeleteAre their pitfalls? You bet. But Mexico is becoming a middle class country. And it will be credit that fuels its success at both the entrepreneurial and individual levels. When consumers feel assured that their government will not devalue their savings, Mexicans will start saving again. But credit will always be a part of that mix.
You are right, of course, Steve. Mexico is developing a middle class with credit and debt being an integral part of that growth. I just fear that the pitfalls may outweigh the rewards.
DeleteShannon, I agree 100% with you! I could have written this Blog myself. I think its what someone else said "we know what's in the future, if they are not careful". I wish they could learn from what happened in the U.S.
ReplyDeleteA few years ago, 3 or 4, as I was walking into one of the big stores, a woman approached me to offer the store credit card. I told her "No thank you", I've had cards in the past, they are dangerous, I'd rather use cash. I said to her " look whats happened to the US". She just smiled and went on to the next person. I understand what Steve is saying but its still scary!
On another note....because of your recommendation my husband and I are going to go to Los Senderos, eat and then take the bicycles for a ride, sounds wonderful!
Saludos, Elenita
Thanks Elenita,I think it is a little scary. I understand that Mexico is changing and that credit is an inevitable part of that change, but you are right, it's a little like "seeing the future".
ReplyDeleteHave a nice time at Los Senderos, I think it is a wonderful spot!