Over the past decade, and especially during the COVID-19 pandemic, the fintech industry has taken off in ways unforeseen. The need for contactless payment methods and secure ways to invest in digital currencies has led to incredible innovations from nearly all corners of the world. Some regions have even had most prosperity in fintech and it is now one of their central sectors for innovation and global recognition, including some African countries like Kenya and Nigeria, and Latin America. The latter has seen over a 60% increase in fintech entrepreneurship over the past few years and is attracting investors from not just that region, but globally as well. Techstars, which is a company whose mission is to help all types of entrepreneurs succeed, has taken an interest in Latin American fintechs recently, but especially since the beginning of this year, providing funding opportunities to startups that may not have the resources to get their ideas off the ground themselves. Some of the countries at the top of the list of investors include Mexico, Brazil and Columbia, with Argentina, Ecuador, and Chile recently joining their ranks. Even some major names from Silicon Valley in California, USA have gained interest in Latin American fintechs, which is a huge opportunity for those companies. Silicon Valley is a region in San Francisco which is known to be a global epicenter for high technological innovation.
So what exactly makes these Latin American fintech startups so attractive to so many reputable sources of innovators and investors? Well in a broad sense, they are offering new ways for financial technological services to be done and accessed by global consumers, often in ways that improve the user experience not yet thought of by mainstream global innovators. On top of this, the opportunity to scale these technologies allows founders to test their own ideas with these innovations no matter where they are in the world quickly and cheaply. The healthy competition also encourages large names in fintech to get involved early on working with these Latin American startups. According to Techstars, those working on fintech operations in fintech have the upper hand of having a deep understanding of the political, geographical, and culture of the region in ways no one else does, allowing them to develop technologies for a huge market like others who are not from there cannot. Many of these companies have been stated as being very open-minded and willing to collaborate, which makes it easier to work together and form partnerships, which ultimately leads to more opportunities.