Low level of banking penetration makes Latam fertile ground for Fintechs

The exponential increase in ecommerce and the use of electronic means of payment have been part of the consequences of this long pandemic.

However, as a shadow cast by this fast-growing sector, there is a truth that is both a great challenge and a great opportunity: the low penetration of banked media among the population of emerging countries, for example, those of Latin America.

“Half of Latam’s population is unbanked. Thanks to the Fintech revolution and financial inclusion, more people are being included in this great network”, said Angélica Arana, specialist in innovation and payment methods at Banorte, during her participation in the Webinar “The 3 main challenges of Fintech in Latin America”, recently organized by Open Finance 2020.

During the event, it was stated that the reduction in the use of cash is a very complex cultural battle in the region, also hindered by low regulatory development.

“The biggest challenges faced by Fintechs in LATAM are regulatory issues, financing and financial education,” said Juliana Carmona, Director of Operations of the Fintech Association Colombia.

It was said that the spread of new fintechs and digital banks offered innovative solutions to address various financial needs, in a context in which health measures forced, to some extent, a reduction in the use of cash.

Nevertheless, specialists agreed that there is a lot of ground to advance in a region like ours that represents fertile ground for this Fintech ecosystem to flourish.

“The most difficult vertical in Fintech is Blockchain & Crypto, due to the fact that a lot of information and evangelizing on the subject is required,” added Carmona.

And he said that currently the technological tools that help Fintech entities the most are Artificial Intelligence, Big Data and Blockchain Technology, which must be worked on.

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