Banking Market Concentration as a Limitation to Financial Inclusion in Mexico: An Analysis Using the Herfindahl-Hirschman Index (2012–2021)

Abstract

Financial inclusion is a key factor in the economic and financial development of individuals, and the success of financial inclusion depends largely on the availability of a robust and diverse banking offer. The aim of this study is to analyze concentration in Mexican banking sector during the period 2012–2021, using the Herfindahl-Hirschman Index (HHI), and to compare the findings with financial inclusion indicators. This approach provides insights into the performance of this sector and serves as a basis for decision-making by relevant entities. In this study, quantitative tools such as index estimation and statistical analysis were employed. The findings reveal a moderate level of concentration in the banking sector, which indicates limited competitiveness within the sector. This in turn adversely affects financial inclusion. The study concludes that there is an urgent need to promote public policies aimed at enhancing banking competitiveness, s well as sustained and robust efforts in financial technological