Don't worry, we speak : Español (Spanish), too!
Contxto – Last Wednesday (26) KoreFusion, a San-Fran-based consulting firm specializing in all-things financials and payments published its 2020 Latam Fintech Report. And while I’ve been one to think the region’s fintech landscape has been changing quickly, according to KoreFusion’s findings, it’s just the beginning, boys and girls.
The report covers some of Latin America’s largest markets. It also points to which fintech verticals are primed for innovative disruption and growth.
Fintech in Latin America
Increasing numbers of smartphone ownership, infrastructure development, e-commerce adoption, and dissatisfaction with banks have been big drivers for fintechs in Latin America.
But KoreFusion basically said the region has only addressed the tip of the iceberg
“It is clear that the changes generated in the industry since 2008 have not been sufficient and that the actual landscape will change for all players, specifically banks and fintechs,” says Jan Smith, co-Founder at KoreFusion.
This conclusion was drawn from the firm’s study of 1,075 fintechs from Brazil, Mexico, Argentina, Colombia, and Chile.
KoreFusion fintech findings
In the report, the largest share of the companies (296) fall into the payments category. Second place is taken by lending fintechs (228). At third place, we begin to see B2B models with enterprise financial management (168).
The abundance of these three is likely fed by investments, as according to KoreFusion, 95 percent of investments went towards fintechs in payments, lending, or digital banks.
In total, fintech has raised US$8 billion in reported funding.
A larger share of fintechs (58 percent) have reached a more mature stage and are currently growing. Meanwhile, 27 percent are still in their adolescence/infancy and were launched less than five years ago.
Moreover, remittances and foreign exchanges are areas in which Latin America still hasn’t reached its full potential, according to the KoreFusion team.
While Latam is home to the likes of remittance startups like Bitso, Global66, and Remessa Online, given the region’s large levels of emigration… it really does have more ground to cover.
But that’s good news for entrepreneurs looking for problems to solve.
The secret sauce to survival
KoreFusion’s co-Founder also hinted as to what will separate surviving fintech from those that close their digital doors.
“The maturity of emerging fintechs and their capacity to develop alliances and capture a majority of investments is key for them to achieve their goals,” said Smith.
So it’s never too early to buddy up fintechs. If you want to take banks, physical cash, or whatever on… KoreFusion says you’ll need friends.
Related articles: Tech and startups from Mexico!