Brazilian fintech unicorn EBANX, the payment gateway for global vendors in Latin America

Written by: Carla Chinski

Contxto – While payments remain outdated in parts of Latin America, the Brazilian fintech EBANX is among one of the regional leaders. Based in Curitiba, the fintech collaborates with international merchants by providing payment gateways into regional markets. Both consumers and companies benefit from more cross-cultural purchases at play.

Snapshot

Description: EBANX is a global, Latin-America based fintech company offering a multitude of payment options for international vendors to sell locally, especially in Brazil. Services include e-commerce solutions, payment processing, as well as localization strategies.
Country: Brazil
Industry: Fintech
Founders: Alphonse Voigt, Joao Del Valle and Walter Ruiz
Founding date: 2012

What is EBANX?

Working closely with e-commerce vendors, one of Brazil’s youngest unicorns allows partners to access modern payment options to scale operations. With this comes lower fees, fairer rates, fewer language barriers, not to mention better customer service.

In Simon Davies’ opinion, EBANX’s  General Manager for the UK, the fintechs acts as “a bridge between the international e-commerce community and Latin Americans who have disposable income and are seeking choice.” 

To achieve this, EBANX provides over a hundred local payment methods in Latin America, meaning variety is key. In essence, EBANX connects big-name companies like Spotify, Airbnb, Sony Playstation and Wish to Latin American consumers wanting to use local payment options to access international products. 

As a result, this improves brands’ loyalty with millions of digital citizens using the platform throughout the region. Moreover, EBANX provides solutions to 1,500 international companies based in over 70 countries.

Beyond payments, there’s also creativity and security to factor. That’s to say, those are the two strategic foundations for EBANX. There are also various side-projects surrounding EBANX, such as its dollars reward program, Latin American business blog, online shopping portal, among others.

How does EBANX work?

The system is quite simple. First, customers select a payment method integrated with EBANX, whether that be via credit or voucher. Following this, then they pay at a physical shop or online. From there, the money goes directly to the integrated company through a really wide range of options.

Catering to many different-sized businesses, EBANX’s diversification is what seems to be making a difference. Even though when it began, it didn’t have as much competition. Now, other companies like Stone or Newbank are entering the picture, showing the region’s potential.

Why is EBANX useful? 

Alphonse Voigt, Wagner Ruiz and Joao Del Valle founded EBANX in 2012 in response to limited payment options for international purchases. Not only did this prevent consumers from accessing certain items, but also prevented international companies from tapping into the Brazilian e-commerce market. 

Whatever options were available were also dominated by big fish like Visa or Mastercard. 

An important thing to keep in mind is the Brazilian population’s use of the “boleto bancário,” a sort of standardized business invoice. In a study conducted by EBANX itself, 71 percent of the sample population showed a preference for this sort of document over other payment methods. 

According to another study, 40 percent of respondents were using the boleto, whether banked or not they had a bank account. Keeping this in mind, it makes sense why EBANX chose to include this as a payment method. 

In August 2013, EBANX started growing, and fast, especially when it partnered with the Chinese online retailer AliExpress. This was the first step of many, keeping in mind that the Alibaba group had, for example, the highest IPO in history at the time.

Related article: Uber partners with EBANX to launch Uber Pay in Brazil.

How did EBANX become a unicorn?

To understand EBANX’s success, it’s necessary to have a more comprehensive approach to understanding the appeal of the Latin American region to international businesses. 

With expanding populations in 33 countries, there’s a market with enormous potential. Strengths range from language uniformity being mostly Spanish, the growth of the middle class, in addition to growing internet penetration.

“We have a deep knowledge of the Latin American market,” said Voigt to Startup Nation. “We engage closely with our consumers and are always looking out for our merchants’ needs. In order to succeed in Latin America, it is very important to understand the specificities of each country.”

What is EBANX’s status? 

Lately, EBANX has been working to expand its overall value, both in terms of market and influence. At that same summit, it launched Beyond Borders Research, a series of surveys and studies aimed at gaining insight into consumer trends and behavior across Brazil.

The previous year, EBANX processed US$1.2 billion in international transactions, which certainly demonstrates the company’s huge scope. Recently, EBANX also obtained its unicorn status after an undisclosed round led by its previous investors.

More so, it launched the Ali Express shopping experience in its native country, involving a huge physical store in Curitiba that provides hands-on experience with Ali Express products. The latest and most relevant effort was the launch of local payment-processing in Brazil, enabling Brazilian companies to use EBANX’s solutions. 

How much has EBANX raised?

Last month, EBANX wrapped up its most recent round led by FTV Capital and Endeavor Catalyst for an undisclosed amount. In the process, it became one of Brazil’s most recently minted unicorns.

Prior to that, in January of 2018, the company raised US$30 million in funding with the same investors. This allowed EBANX to focus on its expansion efforts in Latin America.

What are EBANX’s plans for the future? 

Nowadays, the focus also seems to be more on bilateral commercial relations between Brazil and China. In 2018 alone, EBANX processed 35 million transactions between those two countries. Based on an interview back in August, the fintech expects to process over US$2 billion in payments by the end of the year with 30 percent growth. 

Conclusion

So, what can we learn from EBANX? Basically, what Wagner Ruiz calls “global reconciliation,” meaning to identify problems quickly when it comes to global markets. All the more, it entails recognizing the attractiveness of underexplored sectors and striving towards data transparency. 

But there is no global reconciliation without innovation. Simply look at EBANX’s in-house technology. Not only does this allow for cost reduction but also more direct connections with players.

-CC