Mexico’s financial technology (fintech) industry is growing at its fastest pace ever, with the country spawning as many as 125 new startups in the past 12 months.
Lack of access to banks and an increasing number of smartphones have been the key drivers of the fintech boom in Mexico, with the newly-introduced fintech law opening the door for a wide range of financial solutions.
From micro-loans and peer-to-peer lending services, to remittance companies and online-only banking alternatives, the space is growing faster than regulators could have ever imagined.
According to a study by startup accelerator Finnovista, the Mexican ecosystem is currently over three times larger than Argentina, over four times larger than Chile, and more than double the size of Colombia’s, which is the third largest ecosystem in the region with 124 startups.
Mexico City is home to 61% of these new startups, followed by Guadalajara at 9%, Monterrey with 6%, Merida with 4%, and Puebla with 2%.
In the survey, 83% of companies claimed to be operating only in Mexico, while 17% confirmed operations beyond national borders.
Around 38% of Mexican fintech startups have expanded beyond the region, mostly within Latin America and the Caribbean. Around 11% of them have operations in Europe and 8% in Asia.
However, Mexican fintech startups are still raising small amounts of external funding, as 40% said to have received less than US$100,000, while only 7% claimed to have raised over US$1 million.