Ualá, the Latin American multi-banking fintech, has announced a partnership with Western Union to enable Mexican users of the application to receive money on their phones from friends and family worldwide.
In a statement, the fintech revealed that once the service is activated on mobile, customers will be able to access funds in their account and use them for online or in-store purchases accepting Mastercard, as well as withdraw cash from ATMs without any commission.
Luis Madrazo, CEO of Ualá, stated in the document:
“Remittances sustain the economy of thousands of families. In May alone, over US$5.6 billion was received throughout the country, with an annual increase of 10.7%. The majority of these remittances received in Mexico are settled in cash. By partnering with Western Union, we are offering more ways for our customers to transact remittances within our digital ecosystem.”
According to the figure cited by Ualá in the press release, in May 2023, the surplus of Mexico’s remittance account with the rest of the world was US$5.592 billion, higher than the US$5.057 billion reported in the same month of 2022, according to the Bank of Mexico.
Mexican customers will be able to receive up to 3,000 Investment Units (UDIs) per month in their Ualá account, equivalent to MXN $21,900.00. This amount triples the average individual remittance, which was US$394 between January and March 2023.
The number of fintech users increasing. According to the Mobile App Trends 2023 report published by Adjust, Latin America experienced the largest growth in fintech application sessions in 2022, with a 54% increase compared to the previous year. This growth surpassed the rates of 40% in EMEA (Europe, the Middle East, and Africa) and 30% in the Asia-Pacific region.
Furthermore, according to the Finnovista Fintech Radar Mexico, the number of fintech companies in the country reached 650 by the end of 2022, compared to 512 in 2021, representing an annualized growth rate of 26%.
So far, Ualá has raised a total of $544M in funding over 6 rounds. Their latest funding was raised on Aug 13, 2021 from a Series D round.
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Why is it relevant for venture capital funds?
- The increasing demand for digital remittance solutions in Mexico and Latin America creates a suitable market for investing in the fintech sector, which has shown sustained growth in recent years.
- Investing in companies that aim to bridge the gap and provide accessible financial solutions to underserved populations can generate significant social impact and financial returns for venture capital funds.
With information from: Ualá