The pandemic has had a positive impact on technology adoption. Part of this adoption was seen in e-commerce, leading this sector in Colombia to grow in months what was expected to happen in years, registering figures of more than 200 percent.
This growth in online sales also had a positive impact on sectors such as finance. The need to make online transactions made more and more of the world’s citizens trust digital banking and turn to platforms such as mobile wallets to make purchases or payments for goods and services.
Precisely, platforms such as Movii, the Colombian fintech company founded by Hernando Rubio, will present positive figures during 2020. Last year, the platform started with 300,000 users, but managed to increase the figure to 1.3 million by the end of the year, i.e. it increased its customer base by one million. In addition, some 350,000 debit cards were put into circulation. “We are already the fifth financial institution in the country in terms of number of transactions, including non-cash transactions,” said the manager.
Rubio affirmed that Movii’s growth in 2020 is explained in the changes in people’s habits brought by the coronavirus. He points out that the need to buy online and make their payments and money transfers from their cell phones, without leaving home, were the main drivers of their growth.
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Solidarity Income: how to activate the MOVii card?
In addition to this, the platform participated in the delivery of subsidies that the State provided to support the most vulnerable and affected by the pandemic. “Movii has not only grown in users but also in the use they have had. There is no point in having records with inactive users who do not make transactions. We have one of the best percentages in the industry of users making more than one transaction per month,” he said.
The positive outlook left by 2020 seems to be replicated this year. Rubio assures that as digital solutions are consolidated in the financial sector and more citizens approach them to solve their financial needs, Movii will be a relevant player and will continue to grow.
Thus, they project that they will close 2021 with 3.5 million users who will benefit from services such as bill payments, online purchases with a rechargeable prepaid Mastercard, money transfers, remittances and cell phone recharges all from the cell phone.
Call to transform the financial sector
For Rubio, the transformation of the financial sector is on track with the arrival and democratization of technology, which means providing services at a lower cost and this, in turn, will lead to the creation of a new model based on usability through technology “bringing free financial services to the largest number of people, where much of the success of the system will be monetized by charging third parties and not customers,” said Hernando Rubio, CEO of MOVii.
Movii digital wallet has reached one million users
For him, banking, like other industries in the digital era that is exploding, has to change its model, which historically has been exclusive, based on providing services to those who are able to pay a monthly fee, whether individuals or businesses, resulting in that very few are actually able or willing to pay handling fees, transfers between banks or percentages for using a dataphone. In other words, leading to financial exclusion.
In this sense, the CEO of Movii is critical in stating that Colombia is not measuring the right indicators on financial inclusion in the country and that this situation must be rethought if we want to achieve that all citizens have access to the financial sector.
“Measuring financial inclusion as the percentage of seniors out of the total population who have ever opened a financial product, regardless of whether they do not use it, is not the most relevant indicator,” he said.
He assures that, on the contrary, the country should have other indicators such as the percentage of cash versus digital payments, the percentage of people with a product that they use at least once a month and that their use is not to withdraw cash; or the percentage of businesses out of the total that receive digital payments.
The government seeks to boost financial inclusion in Colombia. Getty
The government seeks to boost financial inclusion in Colombia. Getty – Photo:
“In Colombia the percentage of cash transactions in the last 15 years has dropped just a few percentage points being this the big winner of the game so far; then the question is: are we checking the right indicators or should we measure another one to talk about inclusion.
Government seeks to boost financial inclusion in Colombia
“In Colombia the percentage of cash transactions in the last 15 years has dropped just a few percentage points being this the big winner of the game so far; then the question is: are we checking the right indicators or should we measure another one to talk about inclusion. There is no worse blind person than the one who does not want to see, if we keep saying that we only have to look at the famous access indicator, but at the same time the reality remains that money is still king and digital transactions are not growing”, he pointed out.
In this context, Rubio proposes that in order to win the fight against cash, it is essential to take into account a series of factors that, if applied correctly, could lower the percentage of its use in the country, in addition to promoting financial inclusion.
He states that the first thing to do is to understand the benefits of pocket money. He points out that it is necessary to accept everywhere the possibility of paying with digital money and to eliminate restrictions that prevent the immediate use of money, such as transactions from one bank to another that usually take about 24 hours, as well as charges for this type of transactions.
“Those are features that must be matched, so that banking solutions allow people to do everything with their digital money as cash allows, in addition to providing alternatives that cannot be done with cash, such as buying online; that option is given by digital wallets,” he said.
To that, he added that the coming competitors are technology-based and market disruptors, this means that they are companies that take advantage of technology to offer their services and with a business system that charges or monetizes through third parties or data, helping the democratization of financial services. A panorama of this that should not go under the table is that giants such as Google, Amazon or Facebook, have already designed or launched fully digital financial solutions without charging users.
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First published in Semana, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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