In the realm of financial technology, a seismic shift is occurring, especially in the burgeoning markets of Latin America. Prometeo, an ambitious startup from Uruguay, is at the forefront of this revolution, leveraging the power of open banking to knit together a fragmented financial landscape.
Open banking, a concept that hinges on the use of APIs to modernize and unify banking systems, has primarily seen success in developed economies. Here, the digital transaction landscape is mature, with most individuals and businesses already well-versed in online banking services. However, despite its potential, adoption rates in these advanced markets remain modest. In the UK, for instance, open banking usage hovers around 11% for consumers and 18% for small businesses.
Against this backdrop, Prometeo’s vision shines bright, particularly in Latin America. The region, still catching up in terms of banking services penetration and digital transactions, presents a ripe opportunity for open banking initiatives. Currently, only about 70% of the population in Latin America has access to bank accounts, and the majority of transactions are cash-based. This gap in financial services opens a door for transformative solutions like those Prometeo offers.
Founded in 2018 and having operated on relatively modest funding so far, Prometeo has made significant strides. With a fresh injection of $13 million from heavyweights like PayPal, Samsung, and others, the startup’s valuation is inching close to the $100 million mark. The investment underlines the confidence in Prometeo’s approach and potential, not just from venture capitalists but also from major players looking to expand their footprint in the region.
What sets Prometeo apart is its unorthodox path to growth. Instead of focusing on national rollouts – a common approach given the localized nature of banking regulations – Prometeo is treating Latin America as a unified market. Through a single API, it has already established over 350 channels across 283 financial institutions in 10 countries, with Brazil and Mexico being its largest markets.
The startup’s services, which mirror successful models in other regions, include account-to-account payments, account validation, and cash management for businesses. Co-CEOs Ximena Aleman and Rodrigo Tumaián, with their diverse backgrounds, bring a unique perspective to the fintech space, emphasizing simplicity and efficiency.
Prometeo’s growth trajectory and innovative approach have not gone unnoticed. It has garnered attention and partnerships from leading banking institutions like Citi, Santander, J.P. Morgan, and Vtex, signaling a broader acceptance and eagerness for open banking solutions in the region.
The backing from PayPal and Samsung Next is particularly noteworthy. While not currently in direct collaboration with Prometeo, their investment signals a strategic interest in the open banking sector. PayPal has been steadily increasing its presence in Latin America, including a significant investment in MercadoLibre and leading a funding round for nocnoc, a cross-border commerce specialist. Samsung, dominating the mobile phone market in the region, sees open banking as a key to future transaction methods.
In a region where digital and mobile wallets account for just 10% of transactions as of 2020, the potential for growth is immense. Prometeo’s single API solution simplifies access to payments and data across Latin America, presenting an attractive proposition for businesses aiming to tap into this emerging market.
As Fady Abdel-Nour from Antler Elevate puts it, Prometeo is not just advancing technology; it’s empowering businesses to reach unprecedented heights. With its fresh funding and a vision that aligns perfectly with the needs of a digitally evolving Latin America, Prometeo is poised to redefine the financial landscape, making banking more accessible, efficient, and unified than ever before.
