Mexico: Fertile Fintech GroundBy Jorge Ramos Zwanziger | Wed, 01/13/2021 - 21:01
Mexico has established itself as a fertile ground for the development and growth of Fintech companies, as the global pandemic created conditions for a new digital economy. “The pandemic gave a small push to everything digital … Clearly there is an opportunity for Mexico to take a definitive step toward a digital economy,” said Jorge Ortiz, Co-Founder of Tan Tan, a digital wallet, to El Economista.
This increasing interest in digitalization is becoming apparent in financial services. Before the pandemic, many chose their bank based on location and the number of offices close to them, stated Forbes Mexico. Now, consumers want remote access to financial services and to avoid visits to the bank. Currently, 80 platforms are waiting to be approved under the Fintech Law, of which 50 are digital wallets.
Banks are also jumping on this trend by generating their own solutions or allying with fintech companies. For example, last March, Accendo Banco allied with Toka Internacional, a Mexican company with 19 years of experience and nearly 10 million bank cards. Through this alliance, the bank highlights, “fintech companies do not see us as the competition but rather as allies that provide their clients access banking services,” Javier Reyes, Chairman of Accendo Banco, told MBN.
Toka Internacional sees inclusion as its strategy to reach more customers. To do that, it developed Tokapay, a smart app that gives access to an account and a digital wallet when users download it to their phones. It uses CoDi to guarantee the safety of users, so they can pay for over 160 services or products.
Fintech platforms are also expanding their capabilities during these times. Mexican company Konfío, which provides loans to SMEs, acquired Gestionix, a company that develops cloud enterprise resource planning (ERP) systems for SMEs to ensure agile and efficient management of their businesses. This move was part of Konfío’s efforts to increase its competitiveness in the local market, David Arana, CEO of Konfío, told MBN. "Gestionix offers a special platform for accountants and tax advisors, native in the cloud and with functionalities based on artificial intelligence, which facilitates the service to SMEs and is fully compliant with the standards established by SAT.”
There are still hurdles to overcome for fintech companies, however. For example, the Fintech Law, created in 2018, could be updated to allow the development of more platforms that offer fintech solutions such as digital wallets, explained Ortiz to El Economista.