This week’s edition of Finovate Global looks at recent fintech developments in Mexico.
Mexican digital payments and commerce enablement platform Clip announced a major investment this week. The company, which offers a suite of payments and other financial services solutions to small and medium-sized businesses in Mexico, has raised $100 million in new funding. The capital came courtesy of investment funds managed by Morgan Stanley Tactical Value and an unnamed West Coast mutual fund manager.
In a statement, the company noted that the funds raised value the company “in line” with the company’s Series D round from 2021. That round, led by SoftBank Latin America Fund and Viking Global Investors, added $250 million to Clip’s coffers and gave the Mexican fintech a valuation of “nearly $2 billion.”
Clip Founder and CEO Adolfo Babatz praised this week’s investment as “a testament to Clip’s opportunity to continue to lead the digital transformation of Mexico’s commerce ecosystem.” Babatz continued, “More broadly, (the investment) provides even further validation of our mission to open access to digital payments, financial services, and technology solutions to SMBs in the country. We are excited to leverage this financing round to continue to expand and strengthen our offerings to empower more stakeholders across Mexico’s economy.”
With offices in both Mexico City and Buenos Aires, Argentina, Clip offers a range of solutions to enable SMBs to accept digital payments, sell goods and services online, secure financing, and streamline their operations. The company will use the new capital to accelerate product development and support its efforts to leverage technology to enhance financial inclusion in Mexico. Clip was founded in 2012.
Speaking of financial inclusion in Mexico, Latin American open finance platform Belvo and Citibanamex, the second largest bank in the country, have forged a new partnership designed to put open finance to work in bringing credit access to the unbanked.
Via the collaboration, Citibanamex will extend credit and credit card options to applicants without credit histories. Instead of traditional underwriting, the bank will review factors such as outstanding debt levels and the number of credit applications outstanding, as well as leverage Belvo’s open finance technology to secure income verification for applicants whose data is otherwise difficult to retrieve.
“At Citibanamex, we are continuously seeking financial inclusion solutions to facilitate access to banking products for individuals who have not been able to benefit from current solutions,” Citibanamex Director of Digital Business Development Miguel Lavalle said. “With this new functionality, it will be easier for our customers to verify their income, making credit opening processes more agile.”
Belvo’s open finance and payments platform helps financial institutions and their customers benefit from user-permissioned, secure data sharing. The platform validates employment histories, as recorded by employers, to the Mexican Social Security Institute (IMSS). This enables banks, fintechs, and financial services companies to process financial data and initiate payments directly from users’s accounts.
“This is pioneering and exciting work, aligned with our mission to help financial innovators create new, more efficient, and inclusive experiences for their users,” Belvo General Director, Mexico, Federica Gregorini said. “We are excited to see how financial entities in Mexico are betting on open finance models due to their positive impact on reducing the gap in access to financial services.”
Headquartered in Mexico City, Belvo was founded in 2019. Last month, the company launched its employment data aggregation solution in Colombia. The launch followed Belvo’s partnership with Colombian digital wallet Nequi, a move considered to be a significant advance for the cause of user-permissioned, secure data sharing.
“This connection via API is just the first of many other integrations that will come soon, which portends a promising future in the development of Open Finance in Colombia and in the region,” Belvo’s General Director in Colombia, David Ballesteros, said.
Here is our look at fintech innovation around the world.
Latin America and the Caribbean
- Uruguayan cross-border payment platform dLocal forged a partnership with Lithuanian gaming marketplace Eneba.
- Brazil-based fintech Celcoin raised $125 million in funding in a round led by Summit Partners.
- PayGoal, a fintech based in Argentina, teamed up with Paraguayan acquirer Bancard to launch contactless payments solution Tokefon in Paraguay.
Asia-Pacific
- Open finance technology provider Brankas and Global Finteq forged a strategic partnership to launch Lending-as-a-Service (LaaS) platforms in the Philippines.
- South Korean fintech Travel Wallet secured $10 million in funding from U.S.-based VC firm Lightspeed Venture Partners.
- Japan’s Softbank entered a strategic partnership with Gen AI search startup Perplexity.
Sub-Saharan Africa
- African paytech Flutterwave announced plans to build a cyber crime research center in Nigeria.
- South African fintech Ukheshe rebranded as EFT Corporation.
- Ethiopia’s cabinet approved a legal framework for CBDCs.
Central and Eastern Europe
- German corporate card platform Pliant inked a partnership with Commerzbank
- Lithuanian regtech iDenfy launched its AI-enabled Customer Risk Assessment solution.
- Tietoevry Banking expanded its card personalization services in Riga, Latvia.
Middle East and Northern Africa
- Courtesy of a partnership with Revolut, UAE-based fintech GTN will offer bond trading to EEA customers via the Revolut app.
- Israel-based Refine Intelligence unveiled its new check fraud prevention solution.
- Innovation Village profiled Egyptian wealth management fintech Bokra.
Central and Southern Asia
- India’s Pine Labs is considering a $1 billion IPO.
- The Economic and Social Commission for Asia and the Pacific (ESCAP) profiled women-founded Nepal-based fintech Aloi.
- TBC Bank Uzbekistan announces a $10 million line of credit from Switzerland’s responsAbility Investments AG.