Breaking News: A new approach too credit card pricing is entering Mexico’s crowded market, as Novacard rolls out a fixed daily commission model designed to replace customary revolving interest.
for decades, Mexico’s card market operated largely on revolving balances, interest accrual and various fees. Bank of Mexico data show more than 30 million credit cards in circulation, with a multitrillion‑peso market historically controlled by a handful of banks. Now, a growing fintech segment is proposing a different way to collect payments.
Novacard, a Mexican issuing company backed by Mastercard, is testing a pricing scheme that replaces compound interest with a fixed daily charge. The model aims to deliver a transparent, linear cost profile for cardholders.
What makes the traditional model cost unpredictable
conventional credit cards charge interest on the average daily balance and capitalize it monthly.Over time, this “compound” effect can grow a debt quickly, especially if balances aren’t paid in full. The Total Annual Cost (CAT), regulated by Banxico, attempts to reflect these costs, but it’s complexity can obscure the true price of financing.
Novacard’s fixed daily commission model
Under the Novacard plan, users pay a fixed daily commission of about 29 pesos plus VAT for each day that an outstanding balance remains after the grace period.
The cycle works this way:
- Purchases are made during the period. On the 14th (cut-off date) you receive the amount due.
- You have until the 28th (deadline) to settle the total at no extra cost.
- If you do not pay in full,the daily charge applies retroactively from the date of the first purchase in the period.
- When you settle the balance, the counter resets and the next period begins with no accumulated commissions.
This model eliminates interest capitalization, replacing it with a predictable, linear charge—the opposite of the traditional, compounding debt mechanism.
Comparative snapshot: when each model helps
To gauge practicality, consider two sample scenarios. The figures below reflect the cited costs and typical market assumptions as of January 2026.
| Scenario | Balance | Period | Novacard Cost (approx.) | |
|---|---|---|---|---|
| Scenario A | 5,000 MXN | 14 days | ≈ 471 MXN (29 MXN × 1.16 VAT × 14 days) | ≈ 250 MXN (monthly interest) if unpaid; would accrue further if balance carries |
| Scenario B | 5,000 MXN | 5 days | ≈ 168 MXN | Interest accrued over the month, possibly higher if balance remains |
The takeaway: the fixed daily commission benefits users who pay quickly and want a transparent daily cost. For those who carry a balance for months, the traditional model—though opaque—can sometimes be less expensive in absolute terms.
Who is Novacard targeting?
- Freelancers and independent workers who lack payroll income verification and ofen struggle to access formal credit.
- Youths and individuals with no credit history seeking to establish a financial footprint for the bureau.
- Disciplined spenders who want a clear,predictable daily cost without complex formulas.
Novacard emphasizes accessibility: credit lines up to 200,000 MXN without income proofs and without annual fees for inactivity. This setup aligns with a market where roughly half of adults lack formal credit products.
The broader landscape
Novacard sits within Mexico’s vibrant fintech ecosystem, which Finnovista highlights as a hub for regional financial startups. By offering a simple, predictable cost and removing annual fees, the model positions itself as a practical alternative to traditional banking, especially for users who prefer clarity over complexity.
Critically, the daily‑charge approach provides a transparent comparison to standard bank products, while excluding typical bank add‑ons such as insurance, cash‑withdrawal fees, or inactivity charges. Users should, however, weigh the terms in effect at any given time, since CAT and conditions may vary and should be checked on the issuer’s site.
Key context and considerations
As of January 2026, the mexican market remains dynamic.The fixed daily commission model adds a new dimension to the ongoing debate about credit access, pricing openness, and consumer protection. Bank of Mexico data and independent analyses suggest a diversified landscape where both pricing philosophies could coexist, depending on consumer behavior and financial discipline.
External references and further reading:
Bank of Mexico,
Finnovista,
Novacard,
Mastercard,
Banxico CAT framework.
Bottom line for readers
The emergence of a fixed daily commission credit card represents a meaningful shift in Mexico’s credit culture. It challenges consumers to assess debt through a daily lens rather than a monthly interest accrual, with advantages for those who pay promptly. Yet, it remains essential to compare terms, understand payment windows, and monitor how each product aligns with personal spending habits.
Disclaimer: This overview reflects product terms available as of January 2026. Conditions and CAT may vary by issuer. Always verify current terms before applying.
Engagement
What is your take on fixed daily charges for credit lines? Do you think this model helps curb overindebtedness, or could it hide the true cost of credit?
Would you consider a card like Novacard for back‑up spending or to build credit history? Why or why not?
