The LATAM fintech revolution has arrived in the US.
It is obvious to say that things have changed dramatically for many businesses and companies since the COVID-19 pandemic. Consumer behavior changed and many industries had to adapt their processes, logistics, strategies and products.
What is less obvious is that all that systemic change is happening through technology. In other words, if the economy was able to adapt quickly to hard and challenging times, it is because we were technologically prepared, so change became more a natural process.
If this happened in the US, where a broad range of technological advances were already present, imagine the revolution that post pandemic economy has been in Latin America, a colossal region of more than 670 million people, with a huge opportunity to close technological gaps. It is no surprise that LATAM FinTech´s are growing fast: the underbanked population averages 30 percent, but mobile phones are practically everywhere, and each one is a potential new client for financial technology companies.
One company, Broxel, has gained attention this year after sealing a deal with AT&T, where the telco company has 18 million customers. But who is Broxel?
Broxel was founded ten years ago, in September 2011. Gustavo Gutierrez, President and CEO, had a team of three people in Mexico City who were trying to figure out where the FinTech market was going, a challenging task since there was no such thing as “a FinTech market” in Mexico at that point.
Their analysis and strategy were correct. Today Broxel has over a thousand employees, and over five hundred are experts developing new generation financial technology . The company has issued 12 million cards, has a strong presence with corporate clients (companies and institutions), and has pioneered a way to offer an account in pesos, an account in dollars, and sending remittances, all in the same APP.
What does this mean and why is it revolutionary? Mexicans living and working in the US sent 40 billion dollars in remittances in 2020, in the middle of the pandemic lockdown. There is no other region with such an economic phenomenon. Well, imagine having an APP where underbanked workers can open an account to have their savings in pesos, their everyday transactions in dollars, and send money to their families in Mexico in 40 seconds, when they usually wait up to 48 hours and pay a high rate of commissions. This is what Broxel currently provides and does best, but there are even more advancements on the horizon.
Broxel understood that technological innovation made the company borderless: why limit the market to 126 million Mexicans, when there are another 40 million living in the US, with specific necessities and a strong cultural bond? As the famous boxer Saúl “Canelo” Alvarez has busted borders unpopularity, he is a powerful choice as Broxel´s brand ambassador.
Although Broxel started operations in the US in Texas and California, due their importance in the remittance industry, the company just announced an alliance with a legacy brand in the NFL, the Miami Dolphins, in order to develop the Official Prepaid debit card of the team.
The Miami Dolphins have 9 million fans across the US, and more than 30 percent are Hispanic. Additionally, Broxel is helping to transform the Hard Rock Stadium into a 100 percent cashless venue. No other Latin American FinTech has sealed a deal with an NFL legacy brand, as the Miami Dolphins, and it certainly opens the South Florida market to Broxel.
But an international business-to-consumer strategy is just the half of what Broxel is doing. The company recently signed a deal with Google to build the first LATAM FinTech marketplace. It will start operations later this year and will allow Broxel to display all its FinTech services through Google Cloud´s marketplace. This agreement opened the gates of Latin America to Broxel. In the words of both companies, the deal should help to democratize the concept of FinTech as a service across the continent.
So the next time you hear about a FinTech revolution taking place in Latin America, think of more than companies taking the place of the traditional banks or people having access to financial services like never before; think of borderless companies that quickly evolved into technological enablers and financial-solutions hubs, greatly expanding the already large opportunities into enormous markets.