One of the measures that the Central Bank took to mitigate the effects of the quarantine was to order banks to postpone maturities of loans and credit cards until the end of the Preventive, Social and Mandatory Isolation (APSO).
The fintech companies, which are not obliged to follow this type of regulation, mostly followed the same steps that the monetary entity dictated, thus seeking to alleviate the situation of their clients and, at the same time, send a signal to the Government in the sense of strengthen a bond that, little by little, begins to take shape.
"We understand that this is a difficult time for the economy of our clients, and at Mercado Crédito we want to support them and transmit tranquility to them. The main objective is to accompany them and offer them alternatives that facilitate this situation," said Martín de los Santos, Senior Vice President of Mercado Crédito , by announcing that Mercado Libre was postponing the cancellation of the installments of consumer loans that were due in March.
De los Santos himself, who is a member of the board of directors of the Argentine Chamber of Fintech, was one of those who met with Miguel Pesce when the BCRA took measures to regulate the sector. Now he is one of those negotiating with ANSES and the General Secretariat of the Presidency to channel Extraordinary Family Income (IFE) payments through virtual wallets.
"This is good for us. They open the door for a business and to sit at the table with the authorities. We can help, we must help and now they invited us to participate," reflects the number one fintech, although he acknowledges that channeling the payment of that assistance granted by ANSES will not generate much profit. "The banks are happy that the wallets are taking those customers. They are not profitable, they are not going to be credit subjects," he explains.
It is in this context that the majority of fintech companies acted as if they were under the orbit of the BCRA and, to put it in some way, "self-regulated" granting benefits to their users. Quick of reflexes, the first was Mercado Libre, a decision that was announced just two days after the Central released the regulations for the financial system to act in this way.
By extending the maturity date of consumer loans for a month and not charging late fees in March, the Marcos Galperín firm benefited hundreds of thousands of individuals in Argentina, Brazil and Mexico, postponing more than 2 million installments.
After alleviating the situation mainly to the natural persons who use its platform, Mercado Crédito also came to the aid of small and medium-sized companies: it decided not to collect fees for arrears in installments due in March for loans to merchants who sell through Mercado Free and to those who process collections with Mercado Pago (QR, Point).
With this measure, the company helped more than 150,000 small businesses in Argentina, Brazil and Mexico. These funds that it grants are destined, mostly, for working capital. One fact that they provide from the unicorn is that, in general, these small and medium-sized organizations that finance themselves on their platform "do not have access to traditional bank credit."
Days before delaying maturities, Mercado Libre took other measures aimed at mitigating the effects of this crisis on end-consumer, single-tax and self-employed customers.
- On the one hand, during the first week of compulsory quarantine, it offered discounts of 15% in pharmacies for those who pay for their purchases with a QR code from the app.
- On the other hand, to ease the tax burden, monotributistas and self-employed granted a discount for those who paid their obligations to AFIP through the digital account. The benefit, effective during March, was for all those who canceled these concepts for the first time through the app, a move that also aimed to encourage their use.
Along the same lines, in order to reduce the use of cash, it cut from 0.6% to 0% the sales commissions with a QR code paid with money in the account made from Friday, April 3 to Sunday, April 12. This benefit applies to those businesses, entrepreneurs and SMEs that bill up to $ 50,000 per month.
"This segment also includes thousands of basic needs establishments such as warehouses, supermarkets, greengrocers and butchers, among others," they explain from Mercado Pago. The average sales processed through QR of this group of businesses is about $ 20,000 per month.
Ualá was another player in this market that took similar measures to those imposed by the BCRA on banks. The fintech created by Pierpaolo Barbieri postponed for 30 days the cancellation of loan amounts that matured between March 20 and April 19 inclusive.
"We wanted to put ourselves on the side of the users at a difficult time and send them the message that we only managed to overcome this by working together, together. We knew it was going to be difficult weeks," says iProUP Barbieri, founder and CEO of Ualá. Therefore, he adds, "we unilaterally decided to postpone all loans without our clients asking us to."
In parallel, and along the same lines as its Mercado Libre peers, in recent days it has sealed an alliance with Orders Now to offer a benefit according to the times of quarantine. On the other hand, a direct effect that they noticed in fintech since the compulsory isolation began and the banks are closed is that they accelerated the rate of credit card issuance.
"Since the quarantine began, we have issued more than 60,000 plastics," says Barbieri, and recalls that Ualá has already granted a million and a half prepaid Mastercards. Another fact that stands out is that 50% of the new cards are organic. In other words, it comes from clients who promptly search for Ualá plastic after seeing that friends or family find it beneficial.
"We are validating within 24 hours, when before we did it within 48 hours. We make a special effort to make it as fast as possible, so the plastic is printed and reaches people sooner," says Barbieri, who remarks that The firm added another 20 people from isolation to complete the plan drawn up at the beginning of the year.
For Barbieri, this crisis that in the banking system was channeled by a strong demand for banknotes "is something that accelerates a trend that already existed: reduce the use of cash."
Like Mercado Libre and Ualá, Vivus also acted as banks, giving benefits that help clients at this time, without the need for the BCRA to force them to do so.
"We are giving free postponements of the loan payment because we understand the situation of clients, the vast majority of whom are independent professionals or with informal jobs," Salvador Colagero, country manager of 4finance, the group that has under his umbrella, explains to iProUP Vivus signature.
According to the executive, they do not have a deadline to pay the installments. "We will give as many waivers (extensions) as necessary. If the quarantine is extended they are still unable to leave, we will continue delaying the cancellations at no charge. This is something that we are seeing day by day," he says.
Unlike the rest of its competitors, in Vivus the monthly payments are not paid by automatic debit, but each client chooses how to do it. Thus, one of the effects they saw with the quarantine is that there was a migration from traditional to digital payment channels.
"Before, 70% paid for Easy Pay and now that percentage has been reduced to 45%, changing directly to bank transfer, Mercado Pago or another virtual wallet," he says.
Although it did not take measures similar to those the BCRA imposed on banks, Naranja X, Naranja's virtual wallet advanced with benefits to help its clients.
On the one hand, it sought to accompany the segment of merchants and self-employed people who use nPOS to process cards, giving them the possibility of collecting in 3 installments without interest the sales they make with Visa, Mastercard and American Express and Plan Z with Orange, for all items .
"We bear the cost of financing, without caps or restrictions. This is so that consumers can alleviate their financial situation," they explain to iProUP from Naranja X. In addition, throughout April they offer a discount of up to 50% on top-ups. credit cards for the Personal, Claro, Movistar and Tuenti lines. "We know that 80% of cell phones in Argentina are prepaid and we want to facilitate the connectivity of people who today depend more than ever on this means of communication," they highlight.
Also during April they are offering a 50% discount on transport card recharges "to support those who, even during quarantine, must go out to work fulfilling their activities declared essential", as they highlight.
Meanwhile, together with Naranja they are part of the solidarity campaign "Entre Todos Podemos", through which they donate $ 20 million to Cáritas, the Argentine Red Cross and the Argentine Food Bank Network.
"As a virtual wallet, we provide these three institutions with a Uniform Virtual Account (CVU) so that any Argentine can join with donations from their bank account, virtual wallet or through credit and debit cards without leaving their home," they say. . In addition, for each donated weight, Naranja promised to donate an additional weight.
Finally, they sealed different alliances to offer their clients benefits and solutions designed especially for items and sectors essential to this context, such as pharmacies, supermarkets