The most popular delivery app in Latin America will launch its digital payments platform in the country. Characteristics and challenges
30.11.2018 • 19:08hs • Fintech bet
Fintech bet
Advance: Rappi launches RappiPay in Argentina, will give credits to customers and gifts in shops
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Rappi treads strong in Argentina. With an important growth in the region, the delivery application confirmed to iProUP that its virtual wallet, RappiPay, will arrive in the country in the second week of December.
The new product, which is already available in Mexico, Colombia and Brazil, does not function as an independent platform, but is integrated directly into the implementation of the delivery startup.
In this regard, he stressed that it works on the basis of "credits" that can be charged with traditional methods of payment, such as linked debit cards and third-party tools, to make purchases.
"This does not change Rappi's model, but we are exploring new ways to add value to users," added Russo, and confirmed that functionality is "Rappi's big bet for 2019."
Strictly speaking, the business around the new proposal is to charge a commission for each purchase. The proposal revolves around diversifying revenues, which currently come from its delivery service.
With an eye on the digital transformation of payment methods, the company seeks to consolidate itself as a player of importance in this sector: "We want to transform the experiences that are experienced in cities and exploit innovations that are not being explored".
To be able to impose itself before weighty rivals such as Mercado Pago (which already has more than 200,000 points of sale attached), the app bets to "value time" in transactions.
Likewise, a bonus strategy will be promoted, where "gifts" will be delivered to the stores when an operation is carried out. "It may be that with the purchase of a coffee you get a bonus cookie or some tapas with a pint of beer," explained Russo.
The spokeswoman added that they will use the "cashback" strategy, through which users will receive credits for their expenses that can be used at the time of requesting a delivery and at the adhered physical points.
"Our business model is to provide added value through an app that accompanies customers. For that reason, at the moment we do not want to turn to the financial sector, "Russo clarified, and confirmed that the company opened its first subsidiary in the national territory and constituted RappiPay Argentina as a public limited company.
A business with competition
RappiPay reaches a market in which, according to Prisma data, 70% of people still use cash to pay for services in person, making lines at banks and payment institutions such as Rapipago or PagoFácil.
These are the potential users of the segment to be conquered. Mercado Libre saw this gap and acted quickly: it transformed its payment tool, Mercado Pago, into a virtual wallet. This financial incursion with his brand new fintech earned him a new niche that today leads: more than 200,000 physical stores already allow to operate with their QR code tool.
"This is another step in the technological transformation of finance: we started developing the most efficient digital payment and collection network in the region, launching the country's first prepaid card and working capital credits for the unbanked, and now we are revolutionizing the way to pay in the physical world with QR codes, "said Marcos Galperín, CEO and founder of Mercado Libre.
Its application not only offers a transactional tool, but it works as an investment platform that allows users to have a daily return for the money in their account. How does it work? Those who enter from $ 2 will begin to receive a percentage, with an estimated annual nominal rate (TNA) at 48%.
The interesting thing is that this number exceeds - or at least equals - what banks offer for fixed terms of 30 days. Unlike other financial tools, Mercado Pago allows you to deposit money every day from deposits with debit cards, credit or agencies like RapiPago. If the person wants to withdraw their money, they can do so at any time, although it takes two days to credit the account.
On the way to Mercado Pago, the increasingly recurrent "financial inclusion" appears: "We are convinced that this is the way for more people to be included in the financial system, and we will continue to launch innovative solutions to continue democratizing money in America. Latina, "the firm said just a few months ago.
As an extra data, this tool allows you to pay for services only by reading the code of the invoice (Patent and ABL, for example), upload the SUBE, recharge the cell phone and send money to other users. All this with a daily record of activities and promotions with physical and digital stores.
The boom of virtual money
In the recent report "Use of Electronic Money" by Red Link (UDE Link), data on this growing ecosystem was also revealed. The historical record in the use of digital payment tools stands out.
In the cumulative of the first 9 months of 2018, the use of electronic channels grew 5.3%, while electronic money rose 3%. The most used were home banking and electronic wallet.
Finally, and as an example of this expansion, the VALEpei digital wallet showed an exponential growth: from December 2016 to August 2018, the amounts of money sent on average increased from $ 390 to $ 1,485. Also, the platform exceeded 130 thousand downloads in the digital application stores, with 80 thousand active users.
"Worldwide, 20% of the payment market is now of the fintech, although that of the loans, most of the transactions still belong to the banks. Given the threat posed to the sector, they respond in two ways: on the one hand, try to make digital transformations in their structures, processes and products, and digitize them in their majority, "said Francisco Nelson, director of digital transformation at Axxon Consulting.
With a promising scenario and full of innovative solutions, virtual money makes its way into a market that is increasingly used to operating with digital finances and setting aside traditional tickets.
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