Beautiful Virgin Islands

Tuesday, Oct 07, 2025

Yuliya Barabash

Hot Market: Why Latin America? And Why Now?

The pandemic has certainly scaled up the demand for digital financial services worldwide, and Latin America is not an exception. But was that true before 2020?
Historically, the region had always been challenged economically and politically. A huge mountainous territory and frequent natural disasters neither contributed to rapid growth. Neoliberal policies improved the region’s economic climate, raising a tide of foreign investments.

The situation changed in the last 10 years with the advent of mobile communications which provided a fertile field for the area’s financial and technical development: according to the World Bank’s 2020 data, 51% of the population have bank accounts, but only 35% actually use them. So can you imagine the market potential for Fintech projects in this region? I would say the sky is the limit – half of the population! Similar penetration indices can only be found in Africa nowadays but the level of technical progress is completely different there. Still, the Latin American banking system is overly regulated and built upon high transaction fees and cumbersome account opening processes. Oligopoly has its negative effects: with 5 institutions holding 90% of total assets, market participants do not need to improve their services, implement new products and compete for clients. Major banks are still reluctant to cooperate with each other, and not a single one has provided a transparent open API structure.

Local Fintech projects meanwhile are raising investments at full speed and continue developing. According to the report published by The Economist Intelligence Unit, Fintech and renewable energy have already been the fastest growing sectors of the economy 3 years ago. And this trend is confirmed by major deals and investments in the region. For instance, Brazil’s payment company Conductor raised $150 million at the end of 2020 and has plans for IPO. Also that year, Conductor started expanding internationally, now operating not only in Brazil but in Mexico, Peru, Columbia, Argentina and Ecuador. The Fintech company is supported by Visa and Riverwood Capital, an equity firm. This case in point illustrates that investors see the region’s potential and are willing to invest resources there. Furthermore, Visa is buying YellowPepper, a payment service, to expand its presence in South America. Another example: Nubank, South America’s neobanking challenger, completed another round of investments ($300 million) and purchased Easynvest, an investment app operated in Brazil using the Robinhood model, granting mass customers access to fee-free investments.

As for the B2C segment, positive trends are also observed: according to 2020 data, 33.9% of respondents from Mexico, Columbia and Chile said that they did much more shopping via their smartphones than before. This share is even higher in Brazil: 42% of people in the survey stated that the frequency of their online purchases did not change while 74% said that they bought something using their smartphone more than two times in the last 12 months. So there is a need for convenient payment services, microlending and cyber security.

Overall, in the opinion of the investment bank Goldman Sachs, the sector of payments, loans, personal finance and insurance have the greatest potential. By the way, Goldman Sachs and Morgan Stanley, another major investment bank, invested into Brazilian Fintech startups to secure higher profit margins. As Latin Americans tend to distrust online financial transactions and fear fraud, identification, blockchain and biometrics projects are also gaining ground. I believe that a Fintech solution that will enable financial services and bank products aggregation or, for instance, offer money distribution on the most efficient deposit or savings terms, will simply blow up the market. The post-COVID period made people look for alternative ways of saving and multiplying their money.

In my opinion, we are now clearly seeing the forecasts of 3-4 years ago come true – forecasts that Latin America will become the epicenter of growth of global financial technologies. In the middle of 2020, North and South Americas accounted for the largest share of total Fintech investments ($12.9 billion) while Asia Pacific region and the EMEA accounted for $8.1 billion and $4.6 billion accordingly. And based on EBANX’s annual review Latin America could compete with Southeastern Asia in terms of growth rates in the electronic sector and consequently Fintech.
Newsletter

Related Articles

Beautiful Virgin Islands
0:00
0:00
Close
A Dollar Coin Featuring Trump’s Portrait Expected to Be Issued Next Year
Australia Orders X to Block Murder Videos, Citing Online Safety and Public Exposure
Three Scientists Awarded Nobel Prize in Medicine for Discovery of Immune Self-Tolerance Mechanism
OpenAI and AMD Forge Landmark AI-Chip Alliance with Equity Option
Munich Airport Reopens After Second Drone Shutdown
France Names New Government Amid Political Crisis
Trump Stands Firm in Shutdown Showdown and Declares War on Drug Cartels — Turning Crisis into Opportunity
Surge of U.S. Billionaires Transforms London’s Peninsula Apartments into Ultra-Luxury Stronghold
Pro Europe and Anti-War Babiš Poised to Return to Power After Czech Parliamentary Vote
Jeff Bezos Calls AI Surge a ‘Good’ Bubble, Urges Focus on Lasting Innovation
Japan’s Ruling Party Chooses Sanae Takaichi, Clearing Path to First Female Prime Minister
Sean ‘Diddy’ Combs Sentenced to Fifty Months in Prison Following Prostitution Conviction
Taylor Swift’s ‘Showgirl’ Launch Extends Billion-Dollar Empire
Trump Administration Launches “TrumpRx” Plan to Enable Direct Drug Sales at Deep Discounts
Trump Announces Intention to Impose 100 Percent Tariff on Foreign-Made Films
Altman Says GPT-5 Already Outpaces Him, Warns AI Could Automate 40% of Work
Singapore and Hong Kong Vie to Dominate Asia’s Rising Gold Trade
Trump Organization Teams with Saudi Developer on $1 Billion Trump Plaza in Jeddah
Manhattan Sees Surge in Office-to-Housing Conversions, Highest Since 2008
Switzerland and U.S. Issue Joint Assurance Against Currency Manipulation
Electronic Arts to Be Taken Private in Historic $55 Billion Buyout
Thomas Jacob Sanford Named as Suspect in Deadly Michigan Church Shooting and Arson
Russian Research Vessel 'Yantar' Tracked Mapping Europe’s Subsea Cables, Raising Security Alarms
New York Man Arrested After On-Air Confession to 2017 Parents’ Murders
U.S. Defense Chief Orders Sudden Summit of Hundreds of Generals and Admirals
Global Cruise Industry Posts Dramatic Comeback with 34.6 Million Passengers in 2024
Trump Claims FBI Planted 274 Agents at Capitol Riot, Citing Unverified Reports
India: Internet Suspended in Bareilly Amid Communal Clashes Between Muslims and Hindus
Supreme Court Extends Freeze on Nearly $5 Billion in U.S. Foreign Aid at Trump’s Request
Archaeologists Recover Statues and Temples from 2,000-Year-Old Sunken City off Alexandria
China Deploys 2,000 Workers to Spain to Build Major EV Battery Factory, Raising European Dependence
Speed Takes Over: How Drive-Through Coffee Chains Are Rewriting U.S. Coffee Culture
U.S. Demands Brussels Scrutinize Digital Rules to Prevent Bias Against American Tech
Ringo Starr Champions Enduring Beatles Legacy While Debuting Las Vegas Art Show
Private Equity’s Fundraising Surge Triggers Concern of European Market Shake-Out
Colombian President Petro Vows to Mobilize Volunteers for Gaza and Joins List of Fighters
FBI Removes Agents Who Kneeled at 2020 Protest, Citing Breach of Professional Conduct
Trump Alleges ‘Triple Sabotage’ at United Nations After Escalator and Teleprompter Failures
Shock in France: 5 Years in Prison for Former President Nicolas Sarkozy
Tokyo’s Jimbōchō Named World’s Coolest Neighbourhood for 2025
European Officials Fear Trump May Shift Blame for Ukraine War onto EU
BNP Paribas Abandons Ban on 'Controversial Weapons' Financing Amid Europe’s Defence Push
Typhoon Ragasa Leaves Trail of Destruction Across East Asia Before Making Landfall in China
The Personality Rights Challenge in India’s AI Era
Big Banks Rebuild in Hong Kong as Deal Volume Surges
Italy Considers Freezing Retirement Age at 67 to Avert Scheduled Hike
Italian City to Impose Tax on Visiting Dogs Starting in 2026
Arnault Denounces Proposed Wealth Tax as Threat to French Economy
Study Finds No Safe Level of Alcohol for Dementia Risk
Denmark Investigates Drone Incursion, Does Not Rule Out Russian Involvement
×