A study highlights the growth expected in the coming years for fintech companies in Latin America. Which verticals have growth potential and what role will blockchain and crypto play?
The main factors for the growth of fintech companies in the next three years will be the adoption of crypto and blockchain in payment applications and the advancement of open data ( open finance ) for a massive use of digital credit and savings platforms for non -profits. banked.
This is indicated by a report with a focus on Latin America, carried out by Finnovista and Mercado Pago, in which it indicates that between 2019 and 2022 the region's fintechs allocated 75% of the investment of risk capital to finance digital credit companies (35 .78%) , payment solutions (22.18%) and digital banks (17.56%).Based on these levels of investment, the study affirms that the development of these verticals will be what will drive innovation in the sector of technology-based financial companies that are active in the region in the coming years.
FINTECH GROWTH
The report highlights that in the last four years the fintech sector in Latin America registered a growth of 112%, with 2,300 startups seeking to lead the financial transformation of the region, while the implementation of open finance regulations will make their way in several countries of the region.
As for payment solutions, fintechs are expected to bring biometric and blockchain payments to the mass market and companies of this type that operate with these systems will grow 600% in the next three years, from the 120 that exist currently to around 720 in the year 2025.
Likewise, he points out that the sector is optimistic about the regulatory challenges in the region regarding digital inclusion technologies. At least five countries are expected to successfully establish open finance regulation and three to adopt platforms similar to PIX, which was implemented in Brazil.
At the same time, the sector expects nine out of ten fintechs to maintain collaborations with other financial and non-financial entities to offer comprehensive and embedded solutions , thanks to open data systems and new models that enable the implementation of finance in real time .
The sector expects that with the opening of data the credit market will pick up . Above all, among SMEs and self-employed workers, sectors that have historically had difficulty accessing loans due to lack of credit history, but with public information it will be easier for them.
The report maintains that the sector expects Wealth Management (a vertical focused on investment and savings management) to unlock its potential with the democratization of tools that allow users to preserve the value of money and protect themselves against inflation.
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