Em Conversa: Alternative payment methods with payment technology

Em Conversa tries to uncover the secrets of Latin America (LatAm) which has caused the fintech market to boom, from being worth less than $50 million in 2016, to $2.1 billion in 2022. Alejandro Del Rioregional director for LatAm at Paymentsology sat down with Fintech Times to discuss the growing payment trends emerging in the region.

With over 20 years of proven experience in payments and financial technology, Del Rio joined Paymentology, the global issuer processor. Now leading LatAm as Regional Director, we learn about the latest payment technology trends taking place.

Can you tell me more about the company and your role in it?

Paymentology is a global issuer processor. We essentially provide banks, fintechs and telcos with the technology, team and experience to easily issue and process all types of physical or virtual cards. This could be a debit, prepaid, credit, BNPL or revolving card, just to name a few. We offer this anywhere in the world, quickly and at scale. We have payments experts who bring deep, local market knowledge to the ground in 60 countries in 14 time zones.

As regional director for Latin America, I act as a strategic point of contact for Paymentology’s customers and partners. All the while I lead our growth team and expansion in the region.

What are some payment technology trends we are seeing in LatAm?

Like many places around the world, we see an increasing trend in credit use in Latam. Several are dependent on financial institutions for loans and other forms of credit. In addition, revolving credit, which allows consumers to access a fixed amount of credit that can be repaid and used again, has become popular in the region.

Another trend that has been on the rise is BNPL schemes (buy now, pay later), and installments have also been a popular option. Especially for those who want to make larger purchases while spreading the payments.

In contrast, prepaid options have grown rapidly, with more consumers choosing prepaid cards and accounts as a way to manage their finances. Finally, BIN sponsorship opportunities, where banks or financial institutions sponsor the use of certain debit or credit card networks, have also been increasing in the region.

What is Paymentology doing to improve the payment technology sector in Latin America?

At Paymentology, we are deeply committed to increasing financial inclusion in LatAm and the rest of the world. We want to have a positive impact in the communities we operate in. Part of supporting the promotion of digital transformation in the region is that we will help our customers to solve the shortcomings of the conventional banking system.

We do this via our cloud-based digital payment platform which enables our customers to deliver seamless payment experiences to their customers. In addition, they achieve faster transaction processing, advanced security measures and improved data analysis.

For example, we are incredibly proud to have recently strengthened clients such as Fondadora and DolarApp to become pioneers in bringing apple Pay to digital banking customers in Mexico. This marks a significant step forward in making payment solutions more accessible to the region and allowing people to make purchases with Apple Pay in any global location that accepts it.

How does the LatAm Paytech sector compare to the rest of the world?

In recent years, the LatAm payment technology sector has experienced a significant increase in growth and transformation. We see many innovative solutions emerging to address the unique challenges and opportunities in the region that help people better manage their money. However, compared to more established regions such as the UK, Europe and North America, the LatAm payment technology sector is still relatively nascent. Still, it’s catching up fast.

The digital economy is booming after COVID-19. With that, new consumer demands have come around digital ways of paying. Especially in markets where traditional banking services are not readily available or affordable.

Another factor contributing to the growth of the LatAm Paytech sector is the rise of fintech startups and digital banks, like some of our clients. These disrupt the traditional financial services landscape and offer new and innovative payment solutions to consumers and businesses.

What are some unique challenges associated with the region in the payments technology space?

The LatAm Paytech sector faces unique challenges, such as limited access to capital, regulatory hurdles – like the rest of the world – and a fragmented market with varying levels of technology adoption across different countries and regions.

Nevertheless, the potential for growth remains high and we are well positioned to help our customers and potential customers negate these challenges, helping the region become the largest player in the global payment technology landscape it has the appetite and potential to be . Together with our customers and partners, we are pleased to lead the charge for the rapidly transforming financial industry in LatAm.

Plans for the future (road map and growth plan)

LatAm represents a priority market for us. Especially since we have customers living in Mexico, Brazil, Colombia, Peru, Panama, El Salvador, and we plan to expand to nations like Chile and Argentina. LatAm was our biggest market for growth last year and we want to continue to support our fintech and neobank customers in the region. Besides strengthening our working team in Southern Cone countries, this allows us to understand local contexts and offer better solutions according to ecosystem needs.

We will also focus on promoting the use of digital wallet solutions such as Apple Pay and Google Pay, to streamline the payment process for our customers. Overall, our commitment is to expand our reach and strengthen our position in LatAm.