Friday , August 12 2022

The growth of the fintech enterprise in Colombia in 2018


The Fintech ecosystem of Colombia is more than ever, and the third is the most important in the region, they just overcame Brazil and Mexico, respectively.

In this way, it is based on indicators such as number of ventures, mortality rate and investments that each country attracts for this segment. "Fintech" are technological endeavors that are revolutionary in the financial sector and are growing at full speed.

This is reflected in the Fintech report in Latin America 2018: Growth and Consolidation, discovered by the Inter-American Development Bank (IDB) and Finnovista, which signed 1,666 "fintech" ventures, an increase of 66% from the first measurement that they carried out both institutions last year.

Of the three largest "fintech" ecosystems, Colombia is the fastest growing, with an annual increase of 76% of enterprises, from 84 to 148 ventures.

The segment that was most pronounced in the country was credit, identity and fraud (450%). They are followed by wealth management (300%), business finance management (111%) and loans (80%).

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According to the report, these increases once again demonstrate "the need of the market to incorporate solutions that stop the risks associated with greater technological development."

On the other hand, out of the 703 enterprises identified in the region in the first edition of the report, 85 venture companies suspended their activities in the last 12 months, what assumes a mortality rate of 12%.

As for attracting investment, Brazil's Nubank from Colombian David Velez is the one who raised the largest capital in the region, with a $ 250m transaction in December 2017.

Columbia Sempie is ranked in the ranking, which raised $ 3.6 million in TPGA in September 2017, which attracted $ 2.2 million in October 2017.

Faced with dynamism, Andres Fontao, a partner of the Finnist, emphasizes that the opportunity "is already in the focus of great international investors, including Asia, and we have the first governments that have adopting specific regulatory frameworks for fintechs ".

In the dialog with Money, Gabriela Andrade, a specialist in IDB's financial markets and one of the document coordinator, explained that it is interesting to see that the industry continues to grow with many actors and that many consolidate.

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"As these jobs are consolidated, they reach the scale, their effects will be more obvious and will benefit more users, this growth dynamics without such a high mortality rate is important in this sector," Andrade said. .

He also stressed that the growth of "fintech" due to the market opportunity to the extent that there are still smartphones and more connections, because it paves the way for these business models. He also called for generational changes because more and more people are demanding digital solutions, and entrepreneurs in the region are working on it.

"This growth facilitates financial inclusion, and at the same time we have to see that the way public sector looks at how this has changed, not in all countries, there is dialogue and openness, but in big markets if you see it I believe that this positive attitude of many governments to innovate in financial systems also encourages more entrepreneurs to try to make more investors dare to invest in these companies, "said an IDB official.

On the other hand, the Digital Banking Report in Latin America, which Technisis prepared in cooperation with Stanford, it was deciphered that "fintech" appears as the main competition of banks in the region, although 9 out of 10 banks considered them as potential partners or acquisitions.

"Fintechs executives believe that banks are natural strategic partners, however, the difficulties in integrating the system, the prolonged execution time and the lack of a digital mindset are among the challenges that entrepreneurs refer to with society," Technisis said.

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