Colombian digital wallet FinZi has introduced a lending product for transgender people who want to finance sexual reassignment surgery. It’s an example of how the hyper-personalization of digital financial products can dovetail with a company’s policies to foster inclusion.
FinZi expects to make the first disbursement under its Free Transformation product before the end of 2023. The company says it’s entering a market with lots of scope for exploration since traditional banks are not equipped to cater the particular needs of the LGBTIQ+ segment, according to Juan Zavala, the CEO and co-founder of FinZi.
“The initial challenge is that many people lack access to this type of financial service through traditional banks […], which leads to bigger problems such as the use of clandestine clinics,” Zavala tells iupana in an interview. “It has been a very segregated community […], which has led them to have non-regular jobs and income” and limits their access to credit, he says.
A Free Transformation loan is disbursed directly to the clinic performing the surgery and collected through payment installments, similar to the buy now, pay later (BNPL) method.
Fintechs are exploring new market niches as they come under pressure from the drop in funding for their lending services. According to official data, at least 1.6% of the Colombian population identifies as gay, lesbian, bisexual or trans. In Mexico, at least one in 20 people aged 15 and over self-identify as LGBTIQ+, and of these, 34.8% are transgender.
FinZi says it also has a very structured credit strategy for Generation Z, based on a digital wallet for clients aged 10 and over. “We’ve seen that new technologies, crypto and investments continue to be relevant to young people,” says Zavala.