The images of a crowd lining up on the benches were more valuable than a thousand words. Under-banking, that is, access only to a basic financial service (cash extraction), is very widespread in Argentina and is a public health problem in times of pandemic.
Despite the agglomeration of people seen in different entities, the Government had already advanced to expand the capillarity of electronic media. As iProUP anticipated, the Executive convened the fintech industry as soon as it imposed quarantine to bring closer proposals aimed at reducing physical contact and, therefore, the possibilities of contact.
Given the battery of measures proposed by the Argentine Chamber of Fintech, the Government accelerated some decisions to advance in the "digitization" of the finances of the most neglected sectors.
The first signal came last Saturday, when the Central Bank launched communication A6948, which requires financial institutions, fintech and payment service providers (PSP) to accept transfers and transfers of funds between bank accounts (with CBU) and virtual (with CVU) used by fintech companies. However, interoperability between the two account types was established as of May 2018.
The second took place in the last days. The camera and ANSES are finalizing details so that in virtual accounts, whose "home banking" is digital wallets, the social benefits are credited.
In this way, fintech companies seek to take advantage of the possibility not only of adding users, but also of demonstrating how their model can help society in times of pandemic. For this reason, they drew up a plan in two phases: one that will seek to help the consumer and, shortly, cooperate with SMEs, severely hit by the drop in activity.
Start
In the last months of Emilio Basavilbaso's management at the head of ANSES, the pension body had advanced in the possibility of paying plans, assignments and scholarships through digital wallets.
The idea sought that beneficiaries who do not reside near a bank receive their assets in these applications instead of withdrawing the cash at a local Argentine Mail or a collection network.
Mercado Pago, Plus Pagos (of the Petersen Group) and PIM (of Banco Nación) were the wallets that began with the pilot tests and, today, the only ones enabled to pay these assets. However, according to camera records, there are seven others that submitted the documentation to ANSES: BKR, CAMEPagos, Miii, MONI, Prex, Ualá and xCoop.
But the game is about to open and fintech companies are preparing to serve more than 6.5 million people who already use these applications. And they point not only to the social plans that are already being accredited, but also the Emergency Family Income (IFE) destined for low-income monotributistas and informal workers.
"There are different stages. There are some homologated fintech and others in process. There must be a contract with ANSES, connect systems, perform stress tests and validations because you cannot connect anyone to the banking system due to anti-money laundering issues," Ignacio explains to iProUP Plaza, brand-new president of the Argentine Chamber of Fintech.
According to the executive, the organization is currently "creating a panel to know the status of each digital wallet and what services they can offer", in order to determine which of the firms that make up the entity will be in a position to join this program.
This is an unprecedented opportunity for the industry, which could take advantage of the universe of almost 11 million people that the IFE will receive.
"Many of the possible beneficiaries are people who do not have a bank account or do not use it. The wallets, from the CVU, will allow them to make transfers, payments in shops and invoices. They are going to take advantage of the benefits of technology," he enthuses. Juan Pablo Bruzzo, CEO of MONI.
Alberto Murad, of PlusPagos, points out that "in addition to digital wallets, for the IFE we also offered our points for payment or withdrawal, since they have adequate security measures and space for this demand and with a wide geographical coverage."
Digital banks, that is, those that have the same regulation as their traditional counterparts and offer accounts with CBU, will also join the move.
"Users can assign their Accounts (remunerated savings banks) to collect both ANSES and IFE plans. In turn, since our launch we have the withdrawal method without a debit card, to withdraw money from any ATM in the Banelco network, "Stefano Angeli, Rebanking CEO, explains to iProUP.
From the sector they expect that the demand for digital wallets will grow strongly from this new move, which increased 30% in users in recent days. As an example, there is a button left over: in the last hours, Mercado Pago urged users who did not have a CVU to create it within the app.
Speed and services
Digital wallets already have onboarding, so creating an account can take 10 minutes.
"It is completely digitized: it asks for customer data, a selfie, photos of the document that is verified with the RENAPER and validation of the IMEI (number that identifies each cell phone). Even the AFIP uses this technology," says Bruzzo.
His company, MONI, offers a virtual card for the user to pay on e-commerce sites and digital services (such as Netflix), just minutes after obtaining the account.
"For the current situation, it is important to reduce contact and buy online in supermarkets and delivery apps," says the executive, adding that the virtual card is used until the plastic arrives, which also allows withdrawals at ATMs.
MONI also offers an automatic initial loan "to collaborate in this difficult time." The award is based not only on the user's credit history, but also on an artificial intelligence algorithm that allows a more accurate profile to be created and to reach more people than the traditional method.
Another of the fintech companies that works in this regard is BKR, an Argentine startup that also offers a virtual prepaid Mastercard until the final plastic arrives and whose user registration has grown 30% in recent days.
"Our app allows users to instantly request a virtual card to make purchases. We are working with courier companies to minimize delivery times, taking into account the context we are experiencing," Francisco Chaves del Valle, manager of iProUP, tells iProUP. BKR Institutional Relations.
Naranja X, Naranja's fintech, is another platform that is preparing for the measures that may be taken from the Government. Hernán Corral, Chief Product Officer of the firm, highlights the facilities for inclusion that these types of services provide.
"With an email and password you can already create an account that enables you to transfer, pay, recharge your transport card and cell phone, and buy and sell dollars," said the executive.
He also adds that they are working on adding payment options within their service, in a context in which digital services are increasingly requested.
Meanwhile, the company is promoting the sale of its nPOS, a device that connects to a cell phone and allows any merchant to charge with cards and avoid the use of cash.
Since the beginning of the mandatory quarantine, they registered an increase of 30% in the invoicing by nPOS in businesses exempted from the restriction that are users of this service.
"In this sense, we are offering different promotions of 3 installments without interest to help both small businesses that are very affected by this situation, as well as consumers who can alleviate their financial situation," emphasizes Corral.
Murad, from PlusPagos, the wallet that has synergies with the regional banks Santa Fe, Santa Cruz, San Juan and Entre Ríos, explains to iProUP that they are "working on withdrawing ATMs without cards and receiving money for transfers from abroad, to from the Money Gram agreement. "
In addition, to prevent people from crowding into the banks, they began a correspondent pilot test with the entities of the Petersen Group so that the 1,200 points in their collection network receive deposits from their more than 55,500 users.
For its part, Rebanking launched a battery of discounts related to online purchases and services through its credit card: Carrefour (20% on Wednesdays), Farmacity (15%), Frizata ($ 500), Rappi (25%) and Coderhouse courses (80%).
That people can quickly join the use of fintech solutions is key to the plans of these companies. As iProUP anticipated, the camera and the Government are working on communication campaigns to educate on the management of these platforms.
"It is always a challenge. We ask for dissemination and they ask us for content. The camera as a whole and the companies will make their efforts to promote these tools," says Plaza.
"We create spaces for interaction, promote the development of students, entrepreneurs and merchants, and promote training activities through a program for institutions, colleges and universities. And from this Friday, at 7:00 pm, we will hold a free live webinar through on Instagram, "reveals Chaves del Valle.
However, Bruzzo ensures that the barrier to entry is very low: "Anyone who knows WhatsApp can use a digital wallet." In this sense, to flatten the learning curve, BKR already offers payments through social networks.
In the case of Naranja X, Corral points out that "for those who need assistance, we offer 24-hour care, seven days a week."
"On the other hand, currently, and within the framework of the 'Together we can' campaign, we are deploying different initiatives to accompany their clients and ensure that they can operate and self-manage on digital channels," adds the fintech CPO.
Murad, meanwhile, ensures that PlusPagos is launching "a campaign with our agencies, which are the ones who are in contact with consumers, to explain the benefits of using digital payments."
Phase 2
Although the priority today is for consumers, the companies of the Argentine Chamber of Fintech are preparing to serve another segment hit by the coronavirus crisis: small and medium-sized companies.
"We are in dialogue with the Ministry of Entrepreneurs and SMEs (SEPYME). There are several mechanisms to grant loans to these firms," Plaza anticipates iProUP.
The regulation does not allow them to carry out financial intermediation (use user deposits to give loans), so fintech companies will seek to be the "interface" for third-party loans, such as the $ 350,000 million that the Central Bank will release to banks to launch lines destined for to activate the economy.
"Banks cannot lend money to everyone because of a regulatory issue. And it is difficult for them to reach certain companies, segments or geographies in real time. We will help them target clients," says Plaza.
And he adds: "We are developing a deployment facility such as the Brazilian Development Bank (BNDES), allowing it to be a distribution mechanism for SMEs."
In addition, Plaza emphasizes that another instrument to which they will focus will be the electronic versions of the check, the promissory note and the invoices, with the endorsement of mutual guarantee companies.
"Our objective will be to make the platforms of the State or banks more digestible," says Plaza, who assures that "the electronic credit invoice against large companies is a great vehicle to fund SMEs."
Later they will seek to offer more services to consumers. According to Bruzzo, the next "must-have" step for the industry will be the interoperable QR, which will allow users to read any code with any wallet to pay.
"There is still no definitive OK. We are waiting for the COELSA interface to be robust enough to hold up. Even banks are going to be able to use them and it is a payment method without physical contact," adds the manager, who anticipates that MONI prepares insurance for home.
According to Murad, PlusPagos has "from the beginning a QR payments agreement with merchants and we are completing an integration with FirstData so that the more than 200,000 businesses that operate with POSNet can receive QR payments with their wallets."
For these hours, the chamber celebrates the fluid dialogue it maintains with the Government and the possibility of being more relevant as a tool that helps in times of pandemic. And, when the tremor passes, becoming an established option among Argentines or, at least, for the half that does not use access to financial services.
