Agriculture financing: Blockchain as an option
Blockchain is emerging as a new financing option for agricultural businesses, and one that can reduce costs in an industry of considerable complexity.
Argentine fintech Agrotoken is issuing a stablecoin backed by agricultural commodities such as soybean, corn and wheat. This innovation digitalizes the crops by creating a token that can be exchanged and used to access financing in crypto wallets such as
“I believe [blockchain] technology can open up new credit opportunities. It creates possibilities for differentiated rates for the producer,” says Vítor Uchôa, the founder and CEO of Gavea, a blockchain-based commodities exchange in Brazil, where this type of financial service has made the biggest inroads.
“Tokenization allows us to have collateral […] using blockchain makes the operation more secure and that’s why we get a lower interest rate,” he adds.
Gavea also uses blockchain to tokenize future farm output, allowing producers to access advance payments and boost traceability of their harvests — something required by European regulation, according to Uchôa.
The tokenization of agricultural commodities in Argentina has caught the eye of Santander, which earlier this year joined forces with Agrotoken to offer agricultural loans secured by cryptoassets. In a statement, Santander said blockchain has the capacity to “unlock the producer’s business potential.”
Will asset tokenization be the new way to provide backing for agricultural loans? At iupana we’re keeping an eye on the trend.
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Brazil exports Pix
Colombia’s Fintech Association wants the country to replicate Brazil’s instant payments platform Pix. Industry officials met with the central banks of both countries as a first step. Brazilian President Jair Bolsonaro said last week that other countries such as Canada also want to import the platform, and in the United States, the Federal Reserve will start tests of FedNow, a payment system similar to Pix.
BTG Pactual opens crypto fund
Brazilian investment bank BTG Pactual presented its first Chilean fund focused on the cryptocurrency market, through an agreement with Hashdex Asset Management, a wealth manager specialized in crypto. Most of the portfolio is invested in Ethereum and Bitcoin, and
the bank points out that it is intended for investors with a strong appetite for risk and who wish to invest in cryptocurrencies in a regulated space.
Citi partners with fintech Remessa Online
Citi Brazil established a partnership with Remessa Online, an international payment fintech, to use the bank’s local networks. The aim is to hope to have more efficient payment transfers to Europe, the United States and Canada, three of the main destinations for remittances.
WhatsApp wants to expand
‘conversational commerce’ in LatAm
Meta is evaluating how to spur the use of payment products within WhatsApp. Guilherme Horn, WhatsApp’s operations leader in Brazil, said the social media giant has seen a high adoption rate under an initiative they launched in India to allow customers to use the app to shop in supermarkets. It’s part of the “conversational commerce” the company is promoting. “It’s already working in India. It’s a great success and the expectation is to expand it globally as soon as possible,” said Horn, during Payment Revolution Day 2022.
- Chile’s Financial Market Commission (CMF) accused six entities of fraudulently offering loans through the internet and social networks.
- The Ecuadorian unicorn, Kushki, reports that it is a newly minted acquirer in Peru. This will allow it to provide tools for
managing collections through different means of payment.
- Sebrae, a nonprofit financial service for small businesses in Brazil, is in the process of obtaining a fintech license that will allow it to grant loans using its own resources.
- In Mexico, ePlata received authorization from the regulator to operate as a crowdfunding institution under the country’s fintech regulation.
In Argentina, the Central Bank wants fintechs and traditional banks to provide the same level of user protection.
In Uruguay, the Central Bank’s project to regulate crypto activity is advancing through parliament and now awaits analysis by the House of Representatives.
In Honduras, payment gateways will have to comply with a series of security requirements, raising concerns about their participation in the ecosystem.
- Read the full details of regulatory changes affecting digital finance in Latin America on the iupanaPRO website here.
Kavak obtains US$810 million in financing
The digital used car platform Kavak received US$810 million in financing from HSBC, Goldman Sachs and Santander. The proceeds will be used to strengthen the platform and expand in Latin America.
- Heru, a Mexican financial services fintech for gig workers, raised US$6 million in a round led by Gradient Ventures, Google’s AI-focused investment arm. The proceeds will be used to expand its product suite and improve its tax calculation automation technology.
- Peru-based fintech Wolet, which provides lending solutions for SMEs, raised US$2 million in debt
to expand its loan portfolio.
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This week, Chilean digital platforms Chek and Go Bice explain how they are reaping the benefits of being part of larger financial companies — Banco Ripley and Banco Bice, respectively.
- Banks are using their digital channels to introduce remittance and credit products.
- Banco Bice will expand consumer credit offerings to people without credit cards.
- The banks see the platforms as opening up new, untapped markets.
- Young people are key to their
Find out more in this week’s exclusive interview.