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Itau , which has a strong presence in the banking sector in Chile , is also targeting digital customers in Chile through its neo-banking arm Iti . The new venture will facilitate payments both in-person and online . The foray into the fintech sector comes at a time when competition is growing rapidly in the segment .
Neo-banks like Nubank , for instance , have gained strong popularity across Latin America . These players have attracted millions of customers through their innovative products , including digital wallets , at a very low cost . With increasing competition , incumbent banks have revamped their products .
The move comes on the back of the changing fintech landscape in Chile . The implementation of the fintech law in 2023 , which introduced concepts like Open Finance , is projected to further support the growth of the prepaid card industry in Chile over the medium term .
Walmart opposes the high fees proposed by Transbank for debit cards in the Chilean market
The report says Tenpo has launched a strong offensive against Walmart , accusing the retailer of refusing to accept prepaid cards in its stores and online platform . The digital platform , having over 2.3 million users , argues that Walmart ’ s actions are unjustified and harm the payment industry in Chile .
According to a separate report published on Contxto , there are more than 7 million prepaid cards in circulation , representing 15 % of all active cards in Chile , as of December 2023 .
Although Chile has a significant portion of the banked population , the availability of diverse financial services products is lacking in the country . This is where Prex is seeking the opportunity to become the preferred digital payment solution provider in Chile . In Paraguay , on the other hand , low banking penetration offers a strong growth opportunity . Furthermore , the adoption of virtual wallets is also growing in Paraguay .
Traditional banking institutions are vying for digital customers through the fintech route in Latin America
The changes in financial regulations are driving the competitive landscape in the fast-growing fintech sector in Chile .
Itau , the largest bank in Latin America , is set to enter the neobank market .
Furthermore , the 10 issuers of prepaid cards have experienced an average annual transaction growth of 233 %.
This , the ResearchAndMarkets . com report says , shows the growing popularity of prepaid cards in the Chilean market . Currently , Walmart and Falabella . com are the only major retailers not accepting this type of card .
Walmart has expressed dissatisfaction with the fees proposed by Transbank for debit card transactions , believing them to be too high .
The report quotes Monica Aravena , CFO , Walmart Chile , saying cash transactions only cost the chain one-third of what debit card transactions do . The firm states that it will only consider accepting prepaid cards if they are allowed to negotiate commissions that fit its strategy of offering low prices , particularly for lowerincome customers . p
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