Weak economic growth has become an age-old debate in Mexican society. Our modest contribution will consist in attempting to answer 3 questions:

what is the backbone of the Mexican economy? what specific problem or problems does this backbone suffer compared to economies with more solid growth? how do we overcome them?

Every short statement on a broad issue, the economy, is inherently false, said Alfred Marshall, father of the English Marginalists. Despite our limited space and knowledge, we will take risk into account and try to avoid it.
1. What is the backbone of the Mexican economy? SMEs.
Mexico has just over 5 million businesses. 99.8% are SMEs, which generate 52% of the country’s GDP and 78.5% of employment. (INEGI, National Institute for Statistics and Geography).
These 3 figures make it clear what the backbone of the Mexican economy is: SMEs. Their strengths and weaknesses are to a large extent the same experienced by society as a whole.

2. What specific problem or problems does this backbone suffer compared to economies with more solid growth? Scarce and inefficient financing.
When we analyse the differences between Mexican SMEs and those in neighbouring countries with stronger economies, we can see a difference that hinders their chances of growth compared to their counterparts: scarce and inefficient financing.
How are Mexican SMEs financed? The main source of financing for 85% of Mexican businesses are their suppliers (Banxico).
Only 30% of SMEs use bank credits. However, over 48% of their Latin American counterparts have access to bank credits according to data provided by the World Bank. A significant number of small entrepreneurs use personal credit cards as a source of financing, and others resort to usury and loan sharks.
History gives us many examples that accredit how difficult it is to achieve a desirable, balanced social and economic development with no strong and innovative financial institutions to properly nourish the productive sector both quantitatively and qualitatively. We need not look further than the Industrial Revolution, which was the result of the seed of commercial expansion in the 18th century, and we could not understand this phenomenon without the previous, energetic development of financial institutions that increased the speed of money circulation and access to credit.
In the case of Mexico, there are historical reasons to explain the situation: the strong financial crisis of 1995 led to a contraction of private bank credit that we have not overcome after more than 20 years.
Overcoming this credit crunch and offering innovative, efficient products to businesses, overwhelmingly comprised of SMEs, is urgently needed to consolidate the desired social and economic growth.
3. How do we overcome them? Initiatives such as the Development Bank, Sofomes ENR, AMEFAC.
Aware of the limited access to business credit and its negative impact on social and economic growth, the country’s public and private institutions have been adopting measures designed to correct the situation.
Due to limited space we will only refer to 3 of these initiatives, which we believe are especially interesting:
Development Bank: in addition to establishing the regulatory framework and creating institutions to offer the security needed for the harmonic growth of the Mexican Financial System, the Public Administration has founded the Development Bank (BANOBRAS, NAFIN, BANCOMEXT, SHF, BANJERCITO, BANSEFI). The Development Bank uses over half of its resources (52%) to offer direct financ ing to the private sector. The rest is shared among states, towns and other federal public bodies. (E. Presburger).
Sofomes ENR (Non Regulated Entity): to seek financial inclusion against usury and loan sharking, in July 2006 various financial and mercantile laws were reformed to facilitate the creation of a new type of financial entity: Sofom (Multiple-Purpose Financial Institutions). Their purpose may be to conduct financial renting and/or financial factoring and/or credit transactions for any purpose, and they do not require authorisation from the SHCP (Secretariat of Finance and Public Credit). More than simply financial institutions, Sofomes ENR are SMEs with few shareholders or families that use their own resources (they are not allowed to accrue liabilities) to implement a viable business model in a specific niche. They do this with flexible financial intermediation, creating products tailored to the customer. The over 1,400 Sofomes ENR (of which 100 have a share capital of over 20 billion Mexican pesos and account for 80% of allocated resources) represent 4.2% of private sector financing in Mexico, and 2% of the GDP. For more information on this interesting figure see the detailed *Revolución Financiera en México (second edition by the Mexican Institute of Accountants, September 2015) by Enrique Presburger Cherem, to whom we are greatly indebted.
AMEFAC (Asociación Mexicana de Factoraje Financiero y Actividades Similares, A.C.): comprised of 18 members (14 Financial Institutions and 4 Sofomes), it operates 90% of the factoring transactions in Mexico (433.807 billion Mexican pesos in 2015). Introducing these Asset Based Lending (ABL) solutions in the Mexican Financial Market, known in the Spanish speaking world as Factoring and Confirming* (or Reverse Factoring), offers, particularly to SMEs, the possibility of optimising their working capital position, improving their competitiveness and boosting their profits.
This type of proposal must offer Mexican society the financial innovations that will lead it on the path of balanced and sustained social and economic growth, strengthening the most fragile and numerous part of the productive sector: SMEs. It is the only path that will lead to us fulfilling the forecasts of BBVA Research, which places Mexico as the fifth world economy in 2050, within the select group of EAGLES (Emerging and Growth-Leading Economies, a term created by BBVA Research to identify the main emerging economies).