There has been an increase in investment in fintech payment startups in Latin America this year, according to data from the Association of Private Capital Investment (Lavca).
Fund managers invested $391 million across 22 payment startups in the first half of 2024, which was more than the entire volume of 2023 ($387 million).
According to Emanuel Hernandez, director of research at Lavca, the attractiveness of payment startups drove the fintech sector to “attract the majority of venture capital dollars invested in Latin America – with 41% of all VC capital deployed in the region since 2019”.
Hernandez adds: “If you look at the top 10 sectors of investment, fintech consistently ranks first and accounts for more capital than the next nine sectors combined.”
However, Lavca’s historical data also suggest that this positive trend may be under threat from the PIX effect, with volumes of fintech investment – of which payments is a dominant segment – falling in Brazil following the introduction of Brazil's central bank’s free digital payment system.
PIX was launched in the watershed year for fintech investment in the region – with 2021 seeing a total of $6.2 billion of flows into fintech startups.
