Banks and fintech, furious at the favoritism of the Government for Mercado Libre
If there is a sector that is earning money and escaping the crisis, it is banking.
It is true that financial intermediation fell due to the recession, that companies take less credit and individuals have moderated their consumption. But it is also true that entities earn a lot for the exorbitant rates paid in the market, not to mention what they charge for the delay or those who can not cover the full payment of the card.
Another interesting business is that of salary accounts, since it opens the door to offer their holders different packages or high profitability services. While the banks fight among themselves to increase the participation in this segment, another fierce competition erupts, which has as protagonists the owners of the so-called "virtual wallets".
The recent media crossover between Juan Grabois, referring to the Confederation of Workers of the Popular Economy (CTEP), and Marcos Galperín, CEO of Mercado Libre, seemed at first sight part of the electoral folklore. But, in reality, it is the strawberry of a very appetizing dessert, which everyone wants to eat but few have been invited.
For its leading role and as expected, Mercado Pago - the virtual wallet (and financial leg) of the unicorn - was one of the first to appear in the event organized by the Anses. The plan aims for the State to save the commissions that must be disbursed monthly to the banks -and to a lesser extent the Correo Argentino- when it comes to paying social allowances.
The company commanded by Galperín was guest of honor to the pilot test. And this generated the misgivings of many fintech, who were left chewing anger because they had not even been contacted.
Likewise, another "heavyweight" of the market looks with fear at the advance of the "unicorn". It is the same Banco Nación, owner of the PIM wallet, which belongs to Nación Servicios, a technology that depends on that entity and also manages the Electronic Ticket System (SUBE).
The truth is that the news was read in the sector as a nod from Mauricio Macri to the ecommerce giant who, in turn, does not hesitate to publicly declare in favor of official policies.
But it is also interpreted by bankers as a heavy artillery attack on their business. Especially, because of the capillarity of Mercado Libre, with almost unlimited funds to offer advantages and greater room for maneuver, since it is outside the strict regulations of the Central Bank.
The Anses pilot plan is based on 300 beneficiaries of social plans receiving their salaries through virtual savings banks of Mercado Pago.
If the initiative is successful, some 400,000 users will be able to freely choose between receiving these amounts through Mercado Pago or continue to collect (as they have done up to now) via a bank account or through a Correo Argentino window.
- Each user of the virtual wallet has a CVU (Uniform Virtual Key), equivalent to the CBU (Uniform Banking Code), and an alias that is formed by the username in Mercado Libre followed by a period and the acronym mp
- As a result, these accounts can transfer and receive funds from and to others, be they virtual or banking
- Mercado Pago is not the only one that owns CVU, also digital banks, certain virtual wallets and even the Ualá financial application
The inclusion of the Galperín platform hits the banks very hard, which could be left out of a millionaire business. It is not for less, month to month the organism directed by Emilio Basabilbaso pays to:
- Almost 4 million beneficiaries of the Universal Allowances per child, a total of $ 10,400 million
- 2.8 million people from the Hogar program (for the purchase of carafes), for $ 455 million
- 600,000 students of the Progresar Scholarships, totaling $ 1,080 million
In total, Anses funds distributed to different bank accounts for the payment of social plans amount to a whopping $ 12,000 million.
Banks charge $ 2.40 for each deposit, while Correo Argentino receives $ 100, although its universe is more limited, since it only reaches those who do not have an entity near their home.
For these 7.4 million beneficiaries, the Anses pays through "traditional" channels at least $ 18 million in commissions, when fintech do not charge for these transfers.
Fear in the City
Neither the vast majority of virtual wallets nor digital banks were invited by the Government to the Anses pilot test. At present, the only two players participating are Mercado Pago and PIM.
"PIM has about 100,000 beneficiaries of social plans enabled to charge through its platform being social inclusion, speed and not having to be transporting cash three of the main benefits", assure iProUP from Nación Servicios. From the other side, that of Mercado Pago, they prefer to keep silent.
Meanwhile, in the fintech segment the anger is huge: they feel that there were favoritism of the Government towards Galperín, that no clear nor balanced competition rules were handled and that they have not been given space for them to grow.
In spite of the generalized malaise, their referents try not to be pronounced so as not to be exposed.
The "traditional" bank also avoids showing publicly against the measure. "We are not going to pronounce ourselves on this advance, which clearly favors Mercado Libre," they note from a bank of national capitals.
From ValePEI they claim that they do not operate CVU but they offer an agile interface to consult account statements, make transfers, pay bills and purchases, obtaining balances from bank accounts, a kind of friendly "home banking".
"We were not consulted, if the Anses wanted, could ask the beneficiaries to use the app, because the assets have an associated bank account," they complain from the company.
Another high activity fintech also hides in the off-the-record and claims not to have been invited. "We had to contact the officials and, despite our efforts, they tell us that there are still some issues to be closed in the system," says one of its top managers at iProUP.
The idea of the social security agency is to promote financial inclusion, the main mission that fintech proclaims in a country where half of the citizens are not banked and, therefore, do not access services such as credit cards, loans and fixed terms.
While the Anses plan only contemplates passing the fintech to the 400,000 beneficiaries who collect their salaries at Correo Argentino, the banks expect the worst: a Free Market emboldened by its strong growth on Wall Street.
"Next year will have a free cash flow of $ 370 million to do what you want, reinvest, pay debt, make promotions, etc", analyzes Gustavo Neffa, director of Research for Traders, in dialogue with iProUP. The banks' fear is that this high firepower will be used to gain ground while staying away from Central Bank regulations.
You can, for example, multiply the discounts to encourage purchases made from the cell phone with QR Code, as it did in April. By the way, it is one of the engines to reach 3 million transactions, with more than 260,000 adhered businesses.
In fact, Mercado Libre weaved alliances with different entities to offer products similar to those of banks without this meaning being under the purview of the BCRA, namely:
- BIND Banco Industrial, with which it offers Market Funds: those who have an "idle" balance in the Mercado Pago account obtain returns of 40% average
- Banco Patagonia, with which it issues the Mercado Pago-Patagonia credit card: it has no expenses and offers interest-free installments within the platform
- Mastercard, with which it issues a prepaid card: it is possible to credit the balance, which can be used to pay for services that require a card, such as Netflix and Spotify
With this company, in addition, recently sealed an agreement with which they expect Mercado Pago to become the largest fintech in South America, above other rivals with projection.
In this squad, Nubank stands out, a Brazilian digital bank that -as reported by iProUP- will soon arrive in Argentina. But there are also electronic payment services PagSeguro (UOL) and StonePagamentos, which are listed on Wall Street and were also born in Rio de Janeiro.
While the unicorn feels comfortable flying away from the radar of the body run by Guido Sandleris, the reality is that his plans seem to be in tune with the creation of a bank.
In this sense, if it advances with social plans, it could then reach 5.3 million retirees and 1.7 million pensioners, although it is a difficult target to convince them to use an app. Therefore, the next big step will be salary accounts.
"We are starting to work so that you can choose to collect your salary for Mercado Pago", slips the Technology Manager (CTO) of Mercado Libre, Daniel Rabinovich. In addition, he assures that the firm is advancing in the implementation of the payment of salaries: by having accounts with CVU, you can even make transfers.
Another step in this direction was taken in Brazil, a country in which Mercado Pago obtained authorization from the Central Bank, but to operate as a payment processor.
On the other hand, Argentina offers Mercado Crédito, a form of financing with its own funds -without using user deposits, as banks do-, which also allows it to be outside the control of the BCRA. Of course, this arouses the complaints of the entities.
In the sector there are suspicions that he could launch his own Mastercard, already without the umbrella of Patagonia. The unicorn has already announced that it will move towards contactless technology, which allows the user to make payments by supporting the plastic terminal, ending the signing of coupons.
In the last days, Grabois returned to the charge against Free Market. It accuses the company of exercising a dominant position, by determining high commissions for sales within its ecommerce platform.
Paradoxically, the social leader fears that Macri's favorite entrepreneur adopts a slogan that his political leader, Cristina Kirchner, will pronounce until it becomes a slogan: "Vamos por todo".