The Guide to Banking as a Service in Mexico
Niche knowledge you didn't think you needed until now
Mexico has arguably the largest opportunity worldwide for Banking as a Service (BaaS). Its financial system is in dire need of reform. In a country of 130 million and despite the digitalisation that COVID brought about, 50% of Mexican adults are unbanked.
It’s not just the size of the opportunity that makes Mexico the most interesting market for BaaS. Anti-BaaS regulation inside the country has made it near impossible to replicate traditional models seen in the US and Europe. Rather than killing the industry however, it’s forcing local players to adapt and innovate, resulting in a scenario where local players are attempting BaaS models that are arguably more audacious and disruptive than any other market.
This guide will explain what the key market dynamics are, give an overview of the regulatory challenges, and examine the main players in the industry. To help with these explanations, we’ll lean on US examples throughout given a more widespread understanding of that market.
Let’s get to it.
Read the rest of this post