Saturday , May 28 2022

Mexican Fintech attracts foreign investment


Over the last four years, the increase in smartphones, launches and increased digitalization has increased the interest of businesses to invest in projects in Latin America and Mexico is one of the countries that have earned the most magnet for such investments, especially in the fintech market.

According to Finnovista and the Inter-American Development Bank (IDB) report on the fintech market status in 2017, 65% of Mexican companies received foreign investment and placed them in fourth place in this practice. , under Chile, Brazil and Venezuela.

Ernesto Leal, CEO of the Fintech Association of Central America and the Caribbean, details in the report that one of the reasons why more and more foreign investment is coming to Mexico in technology is due to other markets such as the United States and Europe. they are already saturated and in the region there are still few access mechanisms for capital.

"It was observed how economic innovation extends its borders and goes into new, less mature markets with a wide range of opportunities to explore," cited the report.

The document explained that fintech is one of the sectors that this foreign capital has focused the most on and where Mexico is rated as the other country where fintech startups are registered in the region, just behind Brazil.

Until 2017, Latin America registered a total of 1 166 Fintech startups, of which Mexico concentrates 33% of the total.

In a more general picture of the entrepreneurial panorama in Latin America, between 2012 and 2017, the presence of foreign investors increased more than doubled, and only in 2017 there was a record of new investors.

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"25 international investors debuted in Latin America for the first time in 2017" quoted IDB and Finnovista report.

After Brexit, Britain goes to Mexico

One of the countries that has seen Mexico as an investment objective in Fintech is the United Kingdom, especially after the approval of the Fintech Act 2018.

Rory Kane, chief of fintech and trade with the British embassy, ​​said in an interview with Expansión that this law provides the necessary legal certainty to encourage more British investors to invest in the fintech market in Mexico.

"The Mexico market has been developed in particular to give this legal certainty. With this rule, they can already have the peace of mind to continue with the investments. In other companies, no rules have been made, and it is not possible that things can not be done but The risks are greater and here's the income of the people, says the diplomat.

O & # 39; Kane explained that British investors are some of the fintech segments that may be most interesting to develop in Mexico digital payments, payment and crowd funding services, as they are some of the most successful in the UK.

Currently in Latin America, the fintech segment of payments and transfers is monopolizing investments by 24%, followed by loans with 17.8% management in third with 15.5% of the sector, according to Finnovista data.

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The diplomat warned that after the Brexit process, which means that Britain comes from the euro area, a forward-looking strategy is to focus on international trade rates where technology plays a key role.

"With the United Kingdom's departure from the European Union, teams were created that allow for a better transition and one of them focuses on international trade. (…) With a market developed in Fintech, the scene can already be a little saturated, but for companies to maintain its growth must see beyond the British borders and Mexico represents an opportunity, he says.

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