May 11, 2018
Fintech promises a lot of potential in emerging markets. One of the major problems Fintech companies aim to solve is access for the financially marginalized. A recent Forbes article highlights the recent strides Mexico took toward embracing Fintech.
Creating Certainty through Regulation
Mexico’s lower house of Congress recently approved a bill to regulate the Fintech industry and prevent money laundering. This bill particularly aims to regulate crowdfunding and cryptocurrencies. The house will soon write secondary laws to hash out the details of the regulations. These regulations actually help Fintech companies in providing regulatory certainty in an otherwise unpredictable regulatory landscape. Laws typically follow after new industries that have already scaled. Complying after the fact can threaten companies and their business models.
Reuters cites that the new laws also allow for open sharing of data between banks and financial institutions through public APIs. The president of Mexico’s Fintech association stresses that the data housed by financial institutions belong to the users and not the institutions themselves.
Opportunities for UX Improvement
The article cites a Gallup poll that nearly 75% of Mexicans felt unhappy or indifferent about their banking experiences. User experience also represents a large area of focus for many Fintech firms.
Mexican Fintech to Watch
According to Forbes, 158 Fintech startups exist in Mexico today. Many of them focus on mobile payment options, peer-to-peer lending, micro lending and credit. Techfiler lists some of Mexico’s hottest Fintech startups that focus on tackling issues unique to the Mexican market. For example, Kiwi, looks to help people pay for critical purchases such as food or surgeries. Their platform allows for users to utilize a debt-free, point-based system to receive treatments without breaking the bank.
Another issue Mexican Fintech companies look to address is access. In Mexico, an estimated 61% of the population lacks access to a bank account. Mexico also contains a large rural population for whom traveling to a brick and mortar bank may either be inconvenient or out of the question. According to Forbes, each banking branch in Mexico services over 7,000 customers. Fintech may be one of the solutions to helping bridge the gap of financial access in Mexico.