MARCEL VAN OOST: FINANCIAL ADVISOR AND FINTECH STARTUP FOUNDER WITH COLLABORATION OF MARCIAL GONZALEZ FRAGA
Latin America , in contrast to Europe, is facing a once in a lifetime duality in regards to fintech (Financial Technology). On the one hand, the main countries of LATAM are still lacking financial inclusion metrics across the board (debit card penetration, account penetration, and
bank branches per every 100k citizens are clear KPIs). On the other hand, the technology tools available spread around the world at a much faster pace, creating a gap for financial creativity and new players in the region. With this intro in place, the use of alternative data in Latin America for credit scoring has seen major breakthroughs both for consumers as well as for merchants. Maybe not known as a fintech, but Mercado Credito has used its e-commerce Big Data as a competitive advantage to make lending decisions. Shipping addresses and postal codes, in combination with frequency of purchases on the platform, were key drivers. The use of smartphone data in Brazil , (one of the largest users of mobile per capita around the world) provides for interesting credit scoring approaches with regards to app usage, Facebook contacts, and other scraping info. In Argentina , players are applying technology with the banks’ approach to fund and lend money to the bottom of the pyramid. It is interesting how usually an individual would establish a savings account first and then eventually add credit, but fintechs have reversed this traditional approach.
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