Washington, D.C. — President Donald Trump signed an executive order requiring banks to tighten verification of customers’ immigration status, restricting financial transactions and remittances to Mexico, according to the White House.
The order directs government departments and financial regulators to identify individuals without legal residency who open accounts, apply for consumer loans, mortgages, or credit cards. Trump justified the measure by stating that “the provision of the most basic financial services, without proper customer identification practices, can be abused to facilitate the financing of activities that pose significant threats to national security.”
The executive order places special emphasis on monitoring low-value cross-border transfers, such as remittances to Mexico. The U.S. administration claims these flows fund drug trafficking and terrorism. Trump added that “a recent analysis of Chinese money laundering networks identified how foreign passport holders have used U.S. accounts to facilitate the laundering of more than $312 billion for criminal organizations.”
The regulation is expected to have severe consequences for Mexico’s economy. Gabriela Siller, director of Economic Analysis at Grupo Financiero Base, warned that the measure threatens one of the country’s main sources of income. Remittances account for 5% of domestic consumption in Mexico and represent 3.5% of the national GDP. Of the 11.5 million Mexicans living in the United States, 35% lack regular immigration status, and undocumented migrants send 40% of all remittances to Mexico.
Siller estimated that while migrants will seek alternative channels, a 10% to 20% annual drop in dollar inflows is inevitable. A 20% decline in remittances would reduce Mexico’s GDP by 0.7%, which she described as “a catastrophe for the economy of some families and for Mexico’s growth.”
