Fintech Investments in Latin America Rise 73% Despite a Drop in the Number of Deals in 2024

While the number of investment deals in Latin American fintech companies has decreased this year, the amounts have increased and the average value of the rounds has almost tripled: according to data from Pitchbook, $2.6 billion has been invested in 174 deals so far this year, compared to $1.5 billion invested in 241 deals in 2023, reflecting a 73% increase in total financing volume compared to the previous year.

“Investors’ appetite focused on cost-efficient teams, less capital-intensive models, and B2B solutions, especially in payments and financial infrastructure,” explained Andrés Cano, co-founder and managing partner of Pygma, a US-based accelerator that provides mentoring and support to Latin American entrepreneurs to help them scale their startups globally.

Along with the positive investment outlook, progress was also made in regulatory matters. In Chile, the implementation of the Fintech Law this year marked a milestone, promoting interoperable payments and open finance.

In Colombia, there are already regulations focused on instant payments and regulatory sandboxes (controlled testing environments) that have allowed fintech companies to experiment and innovate in a controlled environment.

“Fintech companies have played a key role in closing financial gaps in the region, which has a large unbanked or underbanked population. Countries like Colombia, with more than 300 active fintech companies, are offering quick access to formal credit,” said Daniel Ospina, co-founder of the accelerator.

The challenges of fintech companies for 2025

While both co-founders welcome the progress, they stress that for 2025 and beyond it is important to make progress on the gaps that still exist. One of the recommendations is to create more uniform regulatory frameworks in the region that facilitate the expansion of fintech companies and reduce legal barriers between countries.

“The relationship between regulators and fintech in Latin America is advancing, but it needs more agility and harmonization to unlock the full potential of the sector. With clear and collaborative regulatory frameworks, the region can become a global leader in financial innovation and banking,” said Cano, who adds that it is also necessary to encourage the creation of new regulatory sandboxes and innovation hubs to test new technologies.

As for their projections for 2025, specialists anticipate a bright future, highlighting that many leading fintechs in the region will diversify their services and expand beyond their national markets.

“At Pygma we support this sector and focus on Latinos building fintech because we see a great opportunity for the future. The best is yet to come, as with the new blockchain infrastructures, openfinance, APIs and artificial intelligence, we can expect greater connectivity, intelligence and interoperability of the financial system, generating even more inclusion,” said Ospina.

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(Featured image by stevepb via Pixabay)

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

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