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The Buenos Aires’based fintech Lemon has partnered with payments giant Visa to bring a new product to life: the Lemon Crypto Card. The card allows you to buy and pay with a 2% cashback in Bitcoin. With the new card, Lemon says it wants to make the use of cryptocurrencies more mainstream.
This is Lemon’s second crypto incursion, as it previously launched a wallet that combines cryptocurrencies with Argentine pesos. Since it was founded in 2019, Lemon was planning to launch this card, said Marcelo Cavazzoli, the company’s CEO, to Bloomberg Linea.
An edge to compete in a saturated market
Lemon Crypto Card comes at a time when banking still has a low penetration in Latin America, and most day-to-day payments are made in cash.
A study by Americas Market Intelligence mentions that the region has seen a slowdown in card penetration because the market is saturated. In order for it to move forward, banks will have to increase the amount of card spending.
This happens in traditional banking, but how are fintech companies trying to be more competitive? By offering more contactless services.
According to the same study, Visa was anticipating this approach way back in 2017, when it issued an official statement to its issuers to mandate that “by the last quarter of 2018, all newly issued Visa credit and debit cards must have the ability to make contactless payments.”
By allowing more of these types of payments, traditional banking could offer a better experience to compete with cash. “Across Latin America, banks are experimenting with next-generation payment technologies. The industry agrees that contactless technologies offer countless opportunities,” said Visa’s statement.
It is not surprising, then, that multiple fintech companies are also gearing their offering towards more innovative experiences with their card payments. Lemon is one of them, as it joins the club of other regional companies that are focusing on card-centered services, such as fellow Argentinean bank Ualá and Brazilian neobank Nubank.
Besides the Bitcoin cashback rewards, Lemon’s bet with its Crypto Card has no maintenance fee and allows for international payment capabilities, according to the fintech’s website.
Where is Lemon going?
After receiving $16.3 million in Series A financing last July, Lemon is already looking to expand to Colombia, Mexico, Chile, Peru, Paraguay, Uruguay, and Brazil.
The company is backed by major investors –some of them very active in the crypto industry– such as Draper Sygnus, Trampoline Venture Partners, Coinbase Ventures, Borderless Capital, Valor Capital Group. Kingsway Capital and Grupo Supervielle.