The Moody’s Analytics agency warned that the Mexican economy could register a 1.7% drop in Gross Domestic Product (GDP) by 2023, in the event that the United States enters a recession.
At the moment there are not enough elements to confirm that Mexico is in recession; however, the Committee for the Dating of Cycles of the Mexican Economy assures that, in the event that the decrease in economic activity and the fall in GDP prevail, Mexico could register a seventh period of recession in the last 40 years.
Should I ask for a loan?
Faced with such a complex scenario, it is essential that people have a healthy management of their finances, as well as their financial products. A question that many people ask themselves is whether or not they should ask for a loan.. It is true that this instrument can be key when it is necessary to settle a financial commitment immediately, the problem comes when the person does not consider how and when he must pay it.
It details that although analysts rule out a short-term recession, a loan during this period can be used for emergencies, applying rigorous financial discipline.
The ideal is to have an emergency fund that we can generate with 10% of our income. In the event that circumstances do not favor us for savings, we can take out a loan to the extent of our possibilities to meet basic needs.
It should be noted that, in addition to this Moody’s prediction, the National Institute of Statistics and Geography (INEGI) recently indicated that inflation in Mexico reached 8.15% during the month of July, the highest level recorded since 2000.
Opportunities amid uncertainty
Although the panorama seems complicated, figures from Rocket.la indicate that there are opportunities to request a loan, taking into account factors such as the interest rate, commissions and the total annual cost of the product. In addition to having a Visa or MasterCard product, it will allow users to access a highly competitive market in online purchases.which can represent great savings compared to physical stores.
The first element that must be analyzed in case of requesting a loan to face economic adversities is the interest rate, which is the main cost of the loan. It is a percentage that can be expressed on a daily, weekly, monthly or annual basis, which indicates the additional amount that we must cover of the requested loan.
What to consider before requesting a loan?
according to the last National Survey of Financial Inclusion (ENIF) 2021prepared by the INEGI, only 34% of the people who applied for a loan compared various products before making a decision, which indicates that it is essential to review at least three options and identify the one that best suits our needs and facilities of payment.
There are financial products for everyone, but we have identified that the main reason for rejection is that people request the wrong product. 43% of people who apply for credit and who are rejected could have been approved if they had applied for the correct credit according to their credit experience and history.
It also points out that the moment in which the credit is requested is key to obtaining it. Applying for a loan when you have maxed out your credit cards or have just opened a new loan is a strong reason for rejection in many institutions. 28% of users who request a loan do so at the least optimal time and this translates into a refusal of the product.
Daniel Rojas Daniel’s experience is as a Financial Regulator. In recent years he has focused on solving online procurement challenges for some of the largest credit issuers in Latam (BBVA, Coppel, Bancolombia, etc). In addition, he has focused on closing business deals with our partners.