The China Mail - In Latin America, Brazilian fintech firms rule

USD -
AED 3.672497
AFN 66.272138
ALL 83.49892
AMD 382.462203
ANG 1.789982
AOA 917.000288
ARS 1416.932599
AUD 1.53055
AWG 1.805
AZN 1.696305
BAM 1.689676
BBD 2.011145
BDT 121.87473
BGN 1.691806
BHD 0.377017
BIF 2940.647948
BMD 1
BND 1.300389
BOB 6.909719
BRL 5.313502
BSD 0.998531
BTN 88.502808
BWP 13.406479
BYN 3.40311
BYR 19600
BZD 2.008207
CAD 1.40157
CDF 2149.999813
CHF 0.805835
CLF 0.024022
CLP 942.419911
CNY 7.11935
CNH 7.12234
COP 3781.99
CRC 501.339093
CUC 1
CUP 26.5
CVE 95.261339
CZK 21.00025
DJF 177.814255
DKK 6.45682
DOP 64.155508
DZD 130.492957
EGP 47.291497
ERN 15
ETB 154.143499
EUR 0.86469
FJD 2.279008
FKP 0.760102
GBP 0.75881
GEL 2.705066
GGP 0.760102
GHS 10.919222
GIP 0.760102
GMD 73.000146
GNF 8667.818575
GTQ 7.651836
GYD 208.907127
HKD 7.773355
HNL 26.25486
HRK 6.516102
HTG 132.907127
HUF 331.353048
IDR 16697
ILS 3.23139
IMP 0.760102
INR 88.70755
IQD 1308.077754
IRR 42099.999826
ISK 126.419967
JEP 0.760102
JMD 160.267819
JOD 0.709013
JPY 154.140507
KES 129.149901
KGS 87.449977
KHR 4019.006479
KMF 421.000313
KPW 900.001961
KRW 1455.444968
KWD 0.307102
KYD 0.832138
KZT 524.198704
LAK 21680.345572
LBP 89418.488121
LKR 304.354212
LRD 182.332613
LSL 17.296674
LTL 2.95274
LVL 0.60489
LYD 5.452268
MAD 9.256069
MDL 17.024622
MGA 4488.12095
MKD 53.252953
MMK 2099.688142
MNT 3580.599313
MOP 7.998963
MRU 39.553348
MUR 45.859659
MVR 15.404973
MWK 1731.490281
MXN 18.383135
MYR 4.159766
MZN 63.950123
NAD 17.296674
NGN 1436.283762
NIO 36.742981
NOK 10.105245
NPR 141.60432
NZD 1.772905
OMR 0.384508
PAB 0.998618
PEN 3.369762
PGK 4.215983
PHP 58.931501
PKR 282.349719
PLN 3.660034
PYG 7065.226782
QAR 3.639309
RON 4.397297
RSD 101.385969
RUB 81.083079
RWF 1450.885529
SAR 3.750366
SBD 8.230592
SCR 13.883651
SDG 600.452639
SEK 9.50598
SGD 1.302885
SHP 0.750259
SLE 23.202165
SLL 20969.499529
SOS 570.62635
SRD 38.598958
STD 20697.981008
STN 21.166307
SVC 8.736933
SYP 11056.839565
SZL 17.302808
THB 32.34202
TJS 9.216415
TMT 3.51
TND 2.95162
TOP 2.342104
TRY 42.230897
TTD 6.768898
TWD 30.992299
TZS 2455.707028
UAH 41.870929
UGX 3494.600432
UYU 39.766739
UZS 12042.332613
VES 228.194033
VND 26300
VUV 122.518583
WST 2.820889
XAF 566.701512
XAG 0.019985
XAU 0.000245
XCD 2.70255
XCG 1.799568
XDR 0.704795
XOF 566.701512
XPF 103.032397
YER 238.497023
ZAR 17.188796
ZMK 9001.20124
ZMW 22.591793
ZWL 321.999592
  • RYCEF

    0.0800

    14.88

    +0.54%

  • SCS

    0.0000

    15.76

    0%

  • BCC

    -0.0900

    70.64

    -0.13%

  • RELX

    -1.1200

    42.27

    -2.65%

  • CMSD

    0.0900

    24.1

    +0.37%

  • RIO

    0.0600

    69.33

    +0.09%

  • CMSC

    0.0700

    23.85

    +0.29%

  • RBGPF

    -0.7800

    75.22

    -1.04%

  • NGG

    1.4600

    77.75

    +1.88%

  • JRI

    -0.0100

    13.74

    -0.07%

  • BCE

    0.0200

    23.19

    +0.09%

  • VOD

    0.2400

    11.58

    +2.07%

  • GSK

    -0.4700

    46.63

    -1.01%

  • AZN

    0.8100

    84.58

    +0.96%

  • BTI

    0.3800

    54.59

    +0.7%

  • BP

    0.7600

    36.58

    +2.08%

In Latin America, Brazilian fintech firms rule
In Latin America, Brazilian fintech firms rule / Photo: © AFP

In Latin America, Brazilian fintech firms rule

When Brazilian sisters Daniela and Juliana Binatti quit their jobs to launch a new financial technology -- or fintech -- product, colleagues called them a pair of upstart nuts.

Text size:

Alas, they ended up founding a company that US credit card giant Visa acquired this year for a cool $1 billion.

Pismo, as the firm these entrepreneurs created in 2016 is called, is the latest big success story of a Brazilian company in the fintech sector -- the one luring the most venture capital in Brazil and Latin America in general.

"When I was 16, my mother sent me out to leave my CV with banks along (the famous road) Paulista Avenue to find a job," said Daniela Binatti, who is 46 and grew up in a family of modest means in the megacity Sao Paulo.

Many of those same banks have now ended up becoming clients of hers.

With more than 450 employees and five offices around the world -- in Brazil, Britain, the United States, Singapore and India -- Pismo was acquired by Visa in June in one of the biggest deals yet in the Brazilian tech sector.

Brazil thus enlarged its herd of unicorns, or startups with a market value of at least $1 billion, to 21 out of a total of 38 in Latin America as a whole.

"Many people thought we were crazy," said Daniela Binatti, the company's director of technology.

She said she and her sister had to "break through a lot of prejudice to set up a Brazilian tech firm at an international level but we were convinced" it would succeed.

Pismo produces technology designed to make it easier for banks to launch card and payment products.

It will allow Visa to serve its customers no matter where they are or what currency they use, because Pismo's technological tools are based in the cloud and accessible from anywhere, Ricardo Josua, Pismo's executive director, said in a joint ad with Visa.

Other fintech companies created in Latin America's largest economy have shown growth potential, such as Nubank, one of the world's largest online banks, listing on Wall Street and with nearly 84 million clients; or Neon, another such bank, which in 2022 received a $300 million investment from the Spanish banking giant BBVA.

- An appealing ecosystem -

Pismo and its predecessors "show that Brazil is the region's ripest ecosystem for creating financial technology companies," said Diego Herrera, a specialist in the Connectivity, Markets and Finance Division at the Inter-American Development Bank.

Brazil, and in particular its fintech firms, lured 40 percent of the nearly $8 billion in venture capital that Latin America received in 2022, said LAVCA, the Association for Private Capital Investment in Latin America.

This is due mainly to the size of the Brazilian market, in which 84 percent of the adult population has a bank account in a country with 203 million people, said Eduardo Fuentes, head of research at an innovation platform called Distrito.

Brazil's outsized role in luring VC money also stems from the fact that just a few banks control this huge market, causing "many problems that entrepreneurs try to resolve," Fuentes added, citing high costs as an example.

What is more, "Brazil attracts international investors because it has skills and an environment favorable to innovation," said Fuentes, citing things like platforms for collective financing, payment institutions, and PIX, a revolutionary system for making small, instant payments.

Herrera said Brazil "is still the most attractive country in the region and keeps luring investment" even though the flow of money has dropped off from the record levels it hit during the pandemic, as the world economy slowed and interest rates rose.

- Opportunities -

There are 869 financial technology companies in Brazil, giving it eighth place in a global ranking in this category created by financial services company Finnovating.

Most of them focus on credit, payments and financial management, said Mariana Bonora, head of ABFintechs.

"Many opportunities arise in niches that are neglected" by traditional banks, such as products that serve people who are vulnerable or for entrepreneurs, Bonora added.

The online bank Cora -- seen as a possible unicorn -- seized on one of those niches to set up its business.

"We serve small and medium-sized companies, which account for more than 90 percent of all companies in this country, with lower costs and less red tape," said cofounder of Cora.

This Sao Paulo-based bank received $116 million in international funding during the pandemic, and boasts 400 employees and a million customers.

Looking ahead, Brazil hopes to consolidate its fintech ecosystem thanks mainly to the "open finance" system promoted by the country's central bank, which will facilitate exchange of data among institutions, said Herrera.

Other sources of innovation will be the regulation of crypto assets and the implementation of the digital real, the Brazilian currency.

M.Zhou--ThChM