Fintech
MercadoLibre in talks to apply for Mexican banking license
MercadoLibre it is reportedly in talks to obtain a banking license in Mexico.
Latin American eCommerce/FinTech is under discussion with the Central Bank of Mexico, the Ministry of Finance and banking regulators to apply for a license, Osvaldo Gimenezpresident of Pago Marketthe company’s FinTech unit, told Bloomberg News on Tuesday (May 21).
“The opportunity is phenomenal. We see in Mexico what has happened in Brazil in the last decade, where there has been a huge increase in access to banking services, electronic payments and credit,” Gimenez said in an interview. “We want to be protagonists in this sense and this will allow us to launch more products”.
The process could take 12 to 24 months, he added, noting that the company considered purchasing a banking license but ultimately decided against it.
While MercadoLibre has a FinTech license in Mexico, a banking license would allow it to receive payroll deposits, remove a limit on amounts held, and more quickly approve and issue credit cards, the report said.
“The banking license will make many things easier, from how we offer credit to users to how we can offer investment products,” Gimenez told Bloomberg. “With the size we already have and the ambition we have to achieve the largest digital bank in Latin America, this move is going in the right direction.”
As Bloomberg noted, Mexico has become an attractive location for FinTech startups, as less than half of the country’s population has a bank account. British FinTech Revolution obtained a banking license last month, while the Brazilian company Nubank has just he applied for one.
There are also plenty of opportunities for merchants in that country to step up their game by adding digital features and making those already available in the market more prominent, PYMNTS he wrote Monday (May 20).
That’s because, as the report states, more and more consumers in Mexico are “turning to digital shopping features that offer savings and improve convenience when shopping in-store.”
At the same time, they love visiting physical locations, but they also want the ease of using digital commerce features, a concept known as Click-and-Mortar™ Shopping.
According to PYMNTS intelligence research, almost 40% of Mexican consumers use Click-and-Mortar™ resources that merchants already have available.
“This hybrid shopping model combines the benefits of in-store experiences with the savings and convenience of digital aids,” PYMNTS wrote. “For example, consumers in a physical store might use mobile apps to check prices or product information.”
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