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The Fintech report in Latin America 2018: Growth and Consolidation, published today by the Inter-American Development Bank and Finnovista, identified 1,166 companies in the financial technology sector (Fintech), representing a 66% growth since the first evaluation by the two institutions. in 2017.
The report also revealed that two out of three companies were already at an advanced stage of development and that Fintech business had expanded to 18 countries in the last year. Following the trend observed in 2017, Brazil is the country with the largest number of enterprises with 380, followed by Mexico with 273, Colombia with 148, Argentina with 116 and Chile with 84.
In addition, one in three companies reported that they have expanded their operations beyond national borders. "While five countries account for 86% of financial technology companies in the region, companies have been identified in each of the Latin American countries and a growing trend towards internationalization shows the opportunities perceived by entrepreneurs, but also the importance of continuing to strengthen dialogue and harmonization at the regional level, "said Juan Ketterer, head of the IDB's Connectivity, Market and Finance Division.
The core business is payments and remittances, accounting for 24% of identified businesses, followed by credit (18%) and corporate finance (15%). It also highlights rapid growth in digital banking and, most importantly, credit rating, identity and fraud.
The report also highlights the dynamism observed in corporate capital investments, reaching record funding figures collected by several Fintech companies in Latin America. "The growth and maturity of the Fintech ecosystem in Latin America over the last year are extraordinary," said Andrés Fontao, managing partner of Finnovista. "The opportunity of financial technologies is already within the reach of major international investors, including Asians, and we have the first governments that have already adopted specific regulatory frameworks for financial technologies."
The importance of regulation in the development of the ecosystem is evident in that only 9% feel that a specific regulation is not required at present, while 35% believe if necessary and 35% consider that the current regulation is adequate, which reflects the progress made in some jurisdictions in the area of regulation. In this sense, the report highlights the progress made through the dialogue between regulators and the sector to promote the search for an environment conducive to innovation.
This report also presents the first regional badysis on gender and fintech. of the woman as founder of Fintech companies, worker in the fintech sector and user of Fintech services. "We found that 35% of Fintech companies in Latin America had a founding wife or a woman in the founding team, a figure well above the global average estimated at 7%," said Gabriela Andrade, financial markets specialist from the United States. IDB. "Although financial technology companies with women in the founding team operate in multiple segments, it is interesting to note that one in three companies focuses on segments of the formal financial sector."
The report provides a series of data. While they also show the challenges facing the sector, they also reflect the inevitable transformation of the financial sector and the role entrepreneurs play in accelerating innovation and changing the interactions between the population and the local people. financial services.
Source: IDB
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