Fintech Companies as a Driving Force for the Argentinian Economy

With a few weeks of perspective that allow for a more comprehensive reading of the year that has just ended, there is no doubt that 2021 was a turning point for the fintech ecosystem. This universe, which has the particularity of being made up of very dissimilar businesses that include, among others, digital payments, credits, investments, and cryptocurrencies, is complex to analyze due to the particular evolution of each of its verticals. However, it is undeniable that fintech as a whole has become a dynamizer of the economy, an actor that everyone looks to when talking about growth, employment, and investment.

Undoubtedly, this second year of pandemic consolidated a trend that began in 2020 when, with the irruption of COVID-19, the entire system responded quickly and efficiently to the demands of a society that needed to continue collecting a salary, paying for goods and services, transferring money or requesting a loan in a context of confinement. The infrastructure was ready: all that was needed was that opportunity to prove it. And the entire sector responded in spades.

Read more about the Argentinian fintech sector and find the latest economic news in the world with the Born2Invest mobile app.

Fintech as a generator of employment

According to a study presented by the Argentine Chamber of Fintech, the sector generates 20,000 direct jobs. And by the end of 2022, it has a growth projection of 50%. If we take into account the complexity of this issue in the current context, these numbers acquire an unquestionable relevance.

Electronic money is growing steadily

The number of CVU’s has tripled: currently, there are 25 million accounts. In a country where, for various reasons, the use of cash is a real problem, this is excellent news. The fact that digitization, which implies efficiency and simplicity but also traceability and formalization, continues to advance poses a hopeful horizon for the not-too-distant future of money as we know it today.

Competition and cooperation, two sides of the same coin

In a system in which there is so much to do, feeding a war or -to use a very current concept- a rift between banks and fintech is not an intelligent approach. In the last months of the year, we witnessed the confirmation of this hypothesis. The successful implementation of the Transfers 3.0 plan (which already registers 50,000 daily transactions) is incontrovertible proof that the solution is competition. This equation also includes collaboration with the public sector, in order to achieve the best solutions for users.

From Argentina to the region

Several companies in the sector have managed to attract very important investments and also to expand, becoming an undisputed reference beyond our borders. Mercado Libre, Ualá, VuSecurity, Pomelo, to name but a few, have managed to land in key countries, consolidating their business and diversifying their services. Many other major players plan to follow in the same footsteps in the coming months.

The boom in the crypto world

With more than two million cryptocurrency accounts, our country is emerging as one of the most widely adopted in the world. Although several international exchanges operate locally, Argentina was the cradle of many companies that have attracted the attention of important funds, achieving outstanding investments. The proliferation of DeFi projects, the boom of NFT’s, and even the visit of Vitalik Búterin, founder of Ethereum, in the last days of the year, are indicators that our country is consolidating as one of the protagonists of this crypto revolution.

We expect that in 2022 these trends will deepen.

And above all, some regulatory movements, such as those we witnessed towards the end of December, do not overshadow them, restricting the climate for innovation. We support a regulatory framework that protects users. But we need it to be flexible enough to allow the great advances we describe in this column to continue to find a fertile and propitious field to continue this development. And let it be in our country.

__

(Featured image by Nestor Barbitta via Unsplash)

DISCLAIMER: This article was written by a third party contributor and does not reflect the opinion of Born2Invest, its management, staff or its associates. Please review our disclaimer for more information.

This article may include forward-looking statements. These forward-looking statements generally are identified by the words “believe,” “project,” “estimate,” “become,” “plan,” “will,” and similar expressions. These forward-looking statements involve known and unknown risks as well as uncertainties, including those discussed in the following cautionary statements and elsewhere in this article and on this site. Although the Company may believe that its expectations are based on reasonable assumptions, the actual results that the Company may achieve may differ materially from any forward-looking statements, which reflect the opinions of the management of the Company only as of the date hereof. Additionally, please make sure to read these important disclosures.

First published in infobae, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

Although we made reasonable efforts to provide accurate translations, some parts may be incorrect. Born2Invest assumes no responsibility for errors, omissions or ambiguities in the translations provided on this website. Any person or entity relying on translated content does so at their own risk. Born2Invest is not responsible for losses caused by such reliance on the accuracy or reliability of translated information. If you wish to report an error or inaccuracy in the translation, we encourage you to contact us.