The secret of fintechs: why they are gaining more customers and can lend you money more easily and quickly
What is the current situation with credit card financing in Argentina and how are fintechs benefiting from it?
In recent months, credit card financing in Argentina has registered a real decline, possibly due to factors such as lack of credit limit updates, high user indebtedness, and recent interest rate increases. The use of credit cards for purchases in Argentine pesos grew by 38% year-on-year in 2021, well below inflation. In January, credit card transactions grew by just 0.2%, while prices increased by almost 4%.
This decline has led to a surge in demand for fintech loans. Fintech companies offer greater flexibility and a wider variety of financing options that cater to different user profiles, making them increasingly popular. In many cases, these companies offer products specifically designed for those who cannot access traditional bank credit or credit cards.
Fintechs such as Alprestamo and Wenance have seen a significant increase in loan requests. Alprestamo, for example, reports a 400% increase in approved loans through their platform. The pandemic has accelerated the digitalization of financial services and boosted trust in fintech solutions, which are seen as effective and accessible.
Many people in Argentina now use fintech platforms for loans, paying for purchases in installments and without a credit card. These platforms analyze various user-specific variables and offer payment options in just a few minutes, giving people who were previously excluded from the traditional financial system access to credit.