Mexico has the most dynamic fintech ecosystem in Latin America, according to Santander

Mexico has the most dynamic digital financial services ecosystem, or Fintech, in Latin America, and traditional banking institutions can represent good support in its development.

Historically, the predominant Fintech segments in the Mexican ecosystem have been Payments and Remittances, along with Loans
Historically, the predominant Fintech segments in the Mexican ecosystem have been Payments and Remittances, along with Loans

In the presentation of the study "Fintech Thermometer: the challenges of regulation", the banking director considered that the sector faces important challenges in Mexico, especially in regulatory matters.

"As a bank, we have pronounced ourselves for a necessary regulation, whose compliance allows a level ground and protects the resources, patrimony and the information of the clients", indicated the Deputy General Director of Transformation and Digital Banking of Santander Mexico, Javier Castrillo. "It is regulation and compliance that has given solidity to the Mexican banking system, hence its relevance to this emerging sector."

The Law to Regulate Financial Technology Institutions, known as the Fintech Law, was published on March 9, 2018, in the Official Gazette of the Mexican government, which seeks, among other things, to raise the levels of inclusion of the population.

The study presented by Santander shows that in Mexico there are more than 515 Fintech companies operating, and more than half are in the expansion phase or ready to scale.

More than 270 of these startups or ventures have acquired capital and debt for an amount equivalent to 629 million dollars, of which more than 300 million were given only in the last year.

The Fintechs generate 3,600 direct jobs and benefit more than 4.5 million registered users in their services in Mexico.

The study included the Embassy of the United Kingdom in Mexico, as well as the global firm Endeavor and the digital financial platform Finnovista.

Mexico is one of the most lagging countries in financial inclusion in Latin America, along with Haiti, Nicaragua and El Salvador, according to figures from the World Bank (WB).

36.9 percent of the population over 15 years old in Mexico (96 million) has an account with some financial institution, a percentage lower than the 54.4 percent average of Latin America, according to "The Global Findex database 2017 "of the BM.

"The collaboration between banks and Fintechs is a win-win, for the benefit of greater financial inclusion and the best financial services for Mexican society," Castrillo said.

By Mexicanist Source Xinhua

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Mexico fintech ecosystem approaching 400 startups

Mexico regained its leadership as the country with the largest Fintech ecosystem in Latin America, with 394 Fintech startups (financial technology companies), according to Finnovista.

The country is slightly ahead of Brazil, the region's second Fintech ecosystem with 380 startups, according to the latest edition of the Fintech Radar. Finnovista said that financial technology companies in Mexico have seen an important evolution of their sector in recent months, since the enactment of the Fintech Law on March 9, 2018, and the subsequent publication of the first secondary provisions on September 10, 2018

While waiting for these provisions generated uncertainty about the measures that must be complied with, in particular by the electronic payment and collective financing fund companies, the Mexican Fintech ecosystem observed a net growth of 18 percent in the number of existing startups since the last measurement published at the end of July 2018.

"The increase in the figure is affected by two phenomena. On the one hand, we found the existence of 98 new startups of recent creation in recent months, representing a gross growth of 29.3 percent; On the other hand, we have estimated that the mortality of Fintech startups since last year amounts to 11.3 percent."

Historically, the predominant Fintech segments in the Mexican ecosystem have been Payments and Remittances, along with Loans; This trend is maintained with these two segments that represent 40.7 percent of the total number of startups.

Other segments have seen significant growth, being led by Digital Banking with the highest annual growth (200 percent) and reflecting the great interest and opportunity in Mexico for digital banks to be increasingly adopted in the market.

On the other hand, Mexico City is the largest center for financial innovation, being the city of origin of just over half of the country's startups; Next is Monterrey and Guadalajara, each as the city of origin of 15 and 11 percent of the startups, respectively.

By Agencies