Mexico-based FinTech Aviva has raised $5.5 million in seed funding.
“This oversubscribed round highlights the strength of our model’s unit economics, as well as our mission to provide innovative and accessible financial services to a market of 70 million people who are still underserved or receive very low-quality products,” the company wrote in a recent LinkedIn post.
The funding will help Aviva develop what it calls its phygital — physical and digital — financial solutions. The company operates a series of kiosks around Mexico that allow users to apply for loans via video call, get approved in real time and receive their funds in under 24 hours.
“Despite countless attempts by FinTechs and neobanks, the smartphone is not a one-size-fits-all solution for providing financial services; a non-conventional strategy is critical,” Filiberto Castro, Co-CEO of Aviva, said in a report by Finextra. “We have proven that our phygital strategy is essential to reaching those who most benefit from access to financial services and who have paradoxically been excluded from the formal financial system.”
Recent reporting by PYMNTS shows that a number of companies are trying to capture the attention of Mexico’s unbanked/underbanked population.
Among them is Blu Financiero, which last month introduced a “mass market” credit card that has a 99% approval rate and can be obtained without a formal credit history.
The company said it had 50,000 people on a waiting list at the time of launch, testament to the need for accessible financial products in Mexico, where just 14% of the people have access to a credit card and only 30% have a formal credit history.
“We see a classic oligopoly problem where four of the top five banks control 70% of the deposits but are all foreign owned,” Casper Yonel, CEO of Blu, said in a news release. “With Mexico comprising less than 5% of their global balance sheets, these top few banks hold little incentive to develop the unique technology required to serve the growing middle class and mass market.”
Meanwhile, PYMNTS wrote earlier this year that real-time payments in Mexico are taking a significant leap forward with the introduction of products like the new account-to-account payments tool from Uruguayan FinTech Prometeo.
“This innovative system employs a single application programming interface (API) to enable instantaneous payments directly to a bank account, granting businesses immediate access to collections — without requiring major technical overhauls,” that report said.
