Fintech: Latin American talent will bring the region through Covid 19
Covid 19 is hitting Latin America hard, but innovators in the fintech industry will help bring the region back to growth by 2021.
According to the World Bank, in 2021 Latin America will register a growth of 2.6%, the highest figure since 2013. Economically speaking, Latin American countries would be able to overcome the worst economic impacts in less than a year.
In this future growth scenario, one of the key industries is fintech. Currently, there are more than 1,100 fintech companies in Latin America and more than half have started their businesses in the last six years. This growth is reflected in investments: fintech companies in the region obtained more than US $ 2.6 billion in funds in 2019.
The growth of Latin American fintech companies is based on their technological talent. The quantity and quality of Latin American technological talent showed sustained growth in recent years. According to Stack Overflow, the most important developer site, the average reputation of the developers is higher in Latin American countries (such as Peru, Colombia, Chile, Argentina, and Brazil) , than for India and China. Despite the fact that India has a greater number of tech professionals, the quality of developers in Latin America is greater than or equal to that of Indian programmers.
One example is Konfio, one of the leaders of fintech in Mexico. It is a financial services platform that includes technology, data analysis and artificial intelligence. With more than a million registered users, in 2019 it received investments of more than US$ 350 million from Softbank and Goldman Sachs. In addition, it was named by the Financial Times as one of the 50 fastest growing companies on the continent.
In Latin America there are 21 unicorns, companies whose value exceeds US $ 1 billion. Two are performing particularly well in the Covid era.
PagSeguro Digital, founded in 2006 in Brazil, offers innovative payment solutions for users and companies. Its shares listed in the US have doubled since a low in late March.
MercadoLibre, the e-commerce platform based in Argentina. Its shares have soared 55% this year as consumers drove a 34% year-over-year increase in gross merchandise volumes during the first quarter.
Those are just two stories in a region filled with endless possibilities. For Latin America to achieve its full potential, talented human capital and financial capital must be in alignment. These innovators are providing access to both, precisely when they’re needed most.