THE COMPANY BUILDERS

RISE OF FINTECH IN MEXICO

FUNDED STARTUPS MKT SHARE IN LATAM80 35% 60%

ACTIVE INVESTORS

7,000+

MKT SHARE IN MEXICO

DELIVERED $4.5M

JOBS CREATED

1,000+

Part 1 - Environment in Latam and Mexico

Part 2 - Fintech in Mexico

Part 3 - Regulation, contributing to or limiting growth?

Part 4 - Future of Fintech in Mexico

AGENDA

High Internet/smart phones penetration

Growing entrepreneurial ecosystem

Economic growth driven by private consumption

ENVIRONMENT IN LATAM & MEXICO

Low banking penetration

Low access to capital for consumers and SMEs

Unsophisticated consumer credit offer

More than 700 Fintech startups in Latam - 25% of IT capital investments for this sector

Highly profitable banks dominating for decades that have not leveraged

technological, digital and mobile solutions, behavioral changes of end-customer and

creation of new business models

Startups128

Startups158

Startups240

88% increase in number of Fintech startups from 2015 to 2017 Mexico leading Fintech market with 730% annual growth

Equity corwdfunding highest growing sector (+256%)

MEXICO LARGEST FINTECH MARKET IN LATAM

SITUATION IMPLICATION

Growth driven by segments with great innovation and dynamism:• Lending (22%)• Enterprise Fin. Mgmt (75%) • Crowdfunding (38%)• Insurances (114%)• PFM (53%)

GROWTH PER SEGMENT

SITUATION IMPLICATION

More than 76% of Fintech startups focused on B2C solutions which means that the retail banking is the most threatened sector

TARGET CUSTOMER

SITUATION IMPLICATION

STARTUP MATURITY STAGE

87% of them have been operating for less than 5 years (55% less than 2 years), however more than 61% is ready to scale or already expanding

SITUATION IMPLICATION

They have proving and improving their models in Mexico but could easily scale and take their innovation to Latam or other markets where they have similar issues.

INTERNATIONALIZATION

SITUATION IMPLICATIONAlmost 30% is working on mobile solutions which will allow them to reach and important portion of the population and 31% is working on open platforms, APIs or sharing economy which highly rely on collaboration

MAIN TECHNOLOGY

REGULATION IN MEXICO“Fintech Law” currently in congress for approval covering crowdfunding, digital payments, cryptocurrencies and new innovative models.

Benefits could be inmense: • reduced operation risks, • more transparency for digital platforms, • higher security and protection for consumers, • Increased confidence in new fintech models, • Reduced uncertainty which could lead to higher capital investments in the sector

Growth will be greater with clear rules!

FUTURE OF FINTECH

Fintech will thrive and continue growing due to:

strong adoption of online/mobile culture of innovation in the financial services sector increased demand from unbanked and underbanked consumers and businesses supportive political and regulatory environment

FUTURE OF FINTECH• Fintech will drive economic

development as it presents more efficient and less expensive solutions

• Disintermediation of traditional key players (banks and fin. institutions)

• Financial services expansion by focusing on financial inclusion of the unbanked or underbanked population

• Startups competing to get up to 30% of the banking market in Mexico, (>US$30 billion)

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THE COMPANY BUILDERS