WealthTech in Latin America – Just the beginning

When you think about Latin American countries you believe that most of FinTechs can solve the problem of financial inclusion as in other developing countries. In fact, WealthTech in Latin America is also a way to reach financial inclusion.

Robo advisor

By FINTECH Books Contributor, Denisse Cuellar
Follow: @DenisseFintech

When you think about Latin American countries you believe that most of FinTechs can solve the problem of financial inclusion as in other developing countries. In fact, WealthTech in Latin America is also a way to reach financial inclusion. Any kind of investment practice is considered an activity of wealthy people. With the rise of robo-advisors FinTechs, Latino american people can be more involved in investment activities and think outside the box or outside the saving account.

I would like to start with Brazil, where Magnetis, the first Robo Advisor of Latin America was born in 2012. Later, Verios joined the robo-advisor team and today they are the two Fintechs leading the transformation of how investments are done in the country. 

These Fintechs focused on small investors that today face the problem of paying high administration fees and a lack of tools to monitor the investment results. In addition, to that they resolve the latent discomfort related to brokers who are more focused on reaching commercial goals instead of caring about customers’ needs.

Robo-advisor FinTechs in Brazil are democratizing investment access to more customers that did not dare to reach a broker and do have the money to invest. They convey the message that investments can be done by everybody. According to the Investor Pulse 2015 survey, Brazilian millennials are very interested in using this type of solution (74% of surveyed).

Having a young population, we expect in a short future a higher adhesion to this new model of investment.  In response to this movement, current incumbents are adapting themselves to the technology and try to create their own solutions. The local WealthTech landscape becomes more complex offering new solutions. For example, robo-advisors serve local traders.

Finally, I started with Brazil because, it was the pioneer in the Latin American landscape but today Mexico and Colombia have also developed their local robo-advisors solution. The WealthTech is currently disrupting the financial inclusion concept in the continent.