Digital Economy taking the SpotlightBy Sofía Hanna | Thu, 05/13/2021 - 17:05
Mexico is the Latin American country with the most participation from foreign fintech companies thanks to the presence of 249 fintech companies, of which 91 are foreign, mainly from the US, Spain and the UK. These companies provide a variety of services ranging from lending to financial enterprise management and crowdfunding. Mexico, however, does not take the top spot in foreign investments in fintech as Brazil has received US$327 million, putting Mexico in second place with US$270.6 million. Nonetheless, Mexico still received more investment than the third, fourth and fifth place combined as Colombia received US$32.6 million, Chile US$26 million and Argentina US$20.9 million, reports KoreFusion.
Mexico is the destination of the most foreign fintech companies looking towards Latin America, says KoreFusion in its 2020 LATAM Fintech Report.
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- Bitso has become the first crypto unicorn in Latin America. Now, the Mexican platform seems to be looking to expand its operations in the region further. The company is now strengthening its regional expansion plan, which led the company to expand its operations in both Argentina and Brazil. "First, we are going to work very hard on our international expansion plan. Today we are already operating in three markets: Mexico, Argentina and Brazil, with much to do in the last two," said Daniel Vogel, Co-Founder and President of Bitso to Forbes Mexico.
While Vogel has good expectations for the company's regional expansion in Latin American, he sees challenges in Mexico as the new Fintech Law could be a barrier to the creation of new companies.
- Mexico received 17.4 percent fewer international tourists during March, explains a report by INEGI. The country welcomed only 2.3 million foreign travelers that month, in comparison to last year's 2.8 million, due to the COVID-19 pandemic. Tourism has suffered many changes and economic shocks after the start of the COVID-19 pandemic. Mexico lost 5.1 percent of its foreign exchange earnings from tourism this March compared to the same month in 2020. Individually, each tourist spent less this year, from US$978 in March 2020 to US$689 this year. Domestic travel is increasingly becoming a trend given the sanitary measures that governments have enforced worldwide. This is why there is a need to develop new tourist areas that will benefit from additional jobs and income. However, these regions must be willing to change at any time because this is what it takes to push the industry forward.
- Gross fixed investment in Mexico grew 2.4 percent in February 2021 compared to the previous month, according to INEGI, but fell 3.5 percent year on year. The growth was caused in part by a 2.6 percent increase in construction investment and a 1.5 percent in machinery and equipment. "Gross fixed investment began to decline in mid-2018, collapsed with the COVID-19 emergency and has subsequently shown an upward trend for a partial recovery," said Julio Santaella, President of INEGI. Remittances, however, have been growing steadily and reached US$4.1 million in March, reflecting a 2.6 percent growth. Other types of investments, such as government bonds, are of less interest to investors. "For the first time in the history of our surveys, we found a negative majority opinion on the advisability of adding risk positions to Mexican local government bonds," says Credit Suisse. Other national investments, such as CETES, have also seen less interest. Forbes claims that investor's interest will depend on the result of the midterm elections where the Chamber of Deputies is at stake.