"The Connection between Europe's Fintech Sector and Latin America's Payment Companies: A Gateway to New Financial Horizons"

Welcome to our 100Startups Interview Series! This time, we have the privilege of speaking with Óscar Castellano, a prominent leader with over 40 years of experience in the financial market and the Credit and Debit Card, Financial Services, Organization, and Systems business, among other key areas of the sector.

Óscar Castellano is the Executive Director of ATEFI, the Latin American Association of Operators of Information Services and Electronic Funds Transfer. ATEFI is a non-profit organization that brings together the leading operators of ATM networks in Latin America. With a total of 23 leading firms in the market, they collectively serve more than 75 million customers, offering the latest technology and a wide range of financial services. Their mission is to promote the development and competitiveness of their members' services through constant knowledge and data exchange, alliances with related institutions, and other mechanisms that contribute to improving their businesses.

In this interview, Óscar Castellano shares with us his vision for facing this disruptive transformation and maintaining relevance and competitiveness in the sector. Additionally, considering that ATEFI is an association that groups companies processing electronic payment methods in Latin America, whose ownership belongs to the banks of each country, Óscar's responses provide us with a unique perspective on how banking networks are responding to this disruptive emergence of Fintech in the market.

Let's discover Óscar Castellano's insights in this exclusive interview:

How would you describe the current situation of the electronic payment industry in Latin America?

The electronic payment market in Latin America is experiencing remarkable growth due to the advanced banking that has developed since the pandemic and the population's need to exclusively use various channels (ATMs, online banking, wallets, QR code payments, bank transfers, etc.) to meet their financial needs.

Out of a total of 196 indicators, 99 maximum growth marks have been recorded in the series over the last 8 years. (* Source: ATEFI Report December 2023)

Clearly, we are facing dynamic growth that seems to have no immediate limits because the growth of electronic money has not only contributed to saving time for customers but also for operators and government agencies, significantly improving the quality of life in that sense for the population.

What are the main challenges and opportunities facing payment companies in the face of the explosive emergence of Fintech in the region?

The variables we analyze in ATEFI represent the market's reality, but this explosive growth has not manifested itself equally in all channels.

Thus, ATMs have had a primary function in supplying money to the population during the pandemic. But after the isolation stage, the appearance and development of other payment methods show higher growth curves, at the expense of ATMs.

And there lies the opportunity. Electronic payment companies are redesigning their strategies to become systemic and secure operators and processors in all payment channels, thus providing quality services with the best security standards.

What role does ATEFI play in the Latin American fintech ecosystem and how does it support companies in the sector?

ATEFI is a non-profit association created 30 years ago by the Networks themselves, to generate value-added for the networks and the industry.

Our essential support is to energize the relationship and communication among associates. We also generate initiatives in the field of training, consultancy, events with strategic content, innovation, security, and technology. The latter represent a strategic value given the development of online payment methods.

Additionally, we generate statistics with data provided by the Associates themselves and encourage with our intervention the dynamic exchange of information about their performance.

What initiatives has ATEFI implemented to promote innovation and growth in the fintech sector in Latin America?

In our vision, the FINTECH sector must converge towards coexistence and complementation with the financial sector. Banks, as highly controlled and regulated industries, can rely on the FINTECH industry to energize the development of new products required by the market and technology advancement. This is especially important due to new societal behaviors and the opportunities offered by social networks, as a significant segment of the younger population is starting to solve their purchases or financial needs through self-management in networks, surprising both the bank establishment and Fintech.

ATEFI, hand in hand with InnEurope, is organizing a visit to Spain in May to explore the European fintech ecosystem. What are your expectations for this visit and what do you hope to achieve by connecting with the fintech sector in Spain?

This new edition of the Fintech experience excites us as much as it challenges us. For our ATEFI member networks, it represents the opportunity to establish concrete ties with the European Fintech ecosystem.

InnEurope, our strategic partner in Spain, and as the operator of the main connection channel with the Fintech universe, position themselves as the right channel to advance in this direction.

We believe that the Fintech experience in Europe represents the best opportunity to adopt such models in Latin America. Europe's leading banks operate in our countries with significant volume and presence.

What are the benefits of establishing a connection bridge between Latin America and Spain in terms of innovation and growth for fintech companies?

The possibilities of generating synergies between Europe's Fintech sector and Latin America's Payment Companies can and should feed back to generate tangible benefits in delivering more and better financial services to customers on both sides of the Atlantic.

How do you think artificial intelligence is impacting or could impact the future fintech landscape in both Latin America and Spain?

In 2023, large companies began to focus on using AI to optimize costs and efficiency. However, the opportunity to use AI to take the human experience of organizations of all kinds to another level is largely still unexplored.

What advice would you give to fintech companies interested in expanding or establishing collaborations between Latin America and Spain?

The companies that thrive in 2024 and beyond will be those that leverage data along with emerging technologies to enhance the human experience for their customers and employees.