What is INFONAVIT in Mexico?

by Administrator | Aug 04, 2023

If you want to start operations in Mexico, you will eventually ask yourself, what is INFONAVIT?

INFONAVIT is Mexico’s National Housing Fund Institute (Instituto del Fondo Nacional de la Vivienda para Los Trabajadores). It was founded in 1972, and the same year, the INFONATIV law was created. Social housing plays a significant role in social security in Mexico.

Its mission is to guarantee decent housing. According to the Mexican constitution, every worker in Mexico has a constitutional right to decent housing. This is clearly stated in Article 123 of the Constitution. Therefore, the institute has two main objectives.

  • To manage the National Housing Fund.
  • To create a credit system for workers in Mexico that gives them access to decent housing.

INFONAVIT in Mexico fulfills its mission by obtaining funds in two ways. First, companies in Mexico are obliged to contribute 5% of their employees’ salaries to housing. This creates an account in each work’s INFONATIV portal.  In this portal, they can monitor how much money they have for housing. Whenever workers wish to apply for credit, they can use this money. Furthermore, it receives a subsidy from the government. This way, they can provide credits at low-interest rates.

When workers ask for a credit to INFONAVIT, they can use it for multiple things. 

  • Buy a home. 
  • Build a home.
  • Remodel their current home.

Why is INFONAVIT important to companies starting operations in Mexico?

There are some mandatory employee benefits in Mexico, and INFONAVIT in Mexico is one of them. If you fail to make these contributions promptly, you will be subject to fines ranging from 55% to 75% of the contribution due.

As stated earlier, every company must contribute 5% of its employees’ salaries to social housing. You can use our Social Security In Mexico Calculator. to calculate your company’s social security burden.

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