Paraguay has been reduced from 5 to just 2 "fintech" businesses related to digital companies this year, which implies a significant fall in terms of creating a financial management platform, according to the IDB report.
The Interdepartmental Development Bank (IDB) report states that there is a rapid growth of these financial-based companies based on technology platforms.
They increased by 66% in the past year, and now total more than 1,160 ventures. On the other hand, our country is astonishingly dropping by 60 percent, with only two investments in 2018, the report said.
Digital advances, especially mobile phone applications, revolutionize financial companies, also known as "fintech", where payment and delivery systems are the most sought-after services in Latin America.
According to the report, in 2018, the countries with the most Fintech companies were, in importance, Brazil (380), Mexico (273), Colombia (148), Argentina (116), Chile (84), Peru (57), Ecuador (34) and Uruguay (28).
The main business segment with the highest profitability is digital payment and settlement platforms (24% of identified companies), then loans (18%) and business finance management (15%).
Fintech represents the innovativeness of traditional financial services and consists of applying technology in the design and / or distribution of financial services and products. An electronic wallet is a clear example of this new dynamics.
In this respect, Carlos Fernández Valdovinos, an economist and ex-secretary of the Central Bank of Paraguay (BCP), recently mentioned that in a country like us where only 29% of adults have an account in a formal financial institution and 95% of households have mobile telephony, electronic money and money orders using mobile phones are a unique opportunity to advance the important task of financial involvement. He pointed out that for that reason the parent bank decided to regulate these procedures at that time and today many banks are already adapting to them and incorporating their schemes because they realize that innovation can not be stifled.
Why do they stagnate?
Financial Analyst Stan Cannova was eager to stagnate financial ventures, despite the huge potential for expansion in our market.
He explained that for a number of reasons, including crash-falling prices, the second reason may be the lack of regulations that set clear rules on the market and the fact that banks themselves adapt the culture of "fintech" as a management process, adhering to its network services payment, delivery and other deprivation of competitive advantage to other independent companies. He finally said they were a fine fine future and that companies have no choice but to adapt to them.