As startups in the financial sector in Latin America received $15.6 billion in funding with 1658 rounds during the period from 2014 to the first semester of 2024, according to the FinTech Report 2024 produced by Distrito, the leading platform for emerging technologies in Latin America. During the same season, that is, 10 years, Brazilian FinTechs concentrated $10.4 billion in investments (66.67% of the total) and 1034 deals.
“The fintech market in Latin America not only resisted global economic challenges but also reinvented itself with innovation and resilience. With strong growth, registering a 75% increase in investments in the first semester of 2024 compared to the same period in 2023, fintechs are leading the digital transformation of the financial market, democratizing access to services and driving financial inclusion throughout the region,” explains Gustavo Gierun, CEO and co-founder of Distrito.
The year with the highest investment in the sector was 2021, reaching $5.7 billion in funding, in 363 rounds. Meanwhile, the year that saw the most startups founded was 2019, with 298 new fintechs, totaling 2214 companies in that segment active in the region that year. Currently, there are 2712 active fintechs, with the highest concentration in Brazil, at 58.7% of the sector’s startups, followed by Mexico, with 20.7% of the companies.
Investment volume per quarter: 2023 – 2024
| Year | Quarter | Number of deals | Investment volume (in billion US$) |
| 2023 | 1Q | 36 | 0.2 |
| 2023 | 2Q | 41 | 0.2 |
| 2023 | 3Q | 28 | 0.3 |
| 2023 | 4Q | 37 | 0.4 |
| 2024 | 1Q | 42 | 0.3 |
| 2024 | 2Q | 41 | 0.4 |
The first half of 2024 stands out for M&A transactions. This year, 16 deals have already been made in Latin America.
Top 5 rounds of 2024 by the first half:
| Startup | Country | Category | Subcategory | Stage | Volume |
| QI Tech | Brazil | Integrated Financial Platforms | Banking as a Service | Series B | 250 |
| Celcoin | Brazil | Integrated Financial Platforms | Banking as a Service | Series D | 125 |
| Clip | Mexico | Payment Methods | POS | Series D | 100 |
| Aplazo | Mexico | Credit | Direct Offer | Series B | 70 |
| Conta Simples | Brazil | Back Office | Financial Management | Series B | 41.6 |
*QiTech had an extension of the round in 2024 which made it a unicorn
Categories in FinTechs in Latin America
Among the categories, Credit holds the first place with 477 startups and 18% of the total fintechs in Latin America. However, considering the investment volume, the leadership in the period was from the ‘Digital Services’ fintechs, which raised US$5.3 billion in funding, followed by those specialized in Credit solutions, which received US$3.1 billion in investments.
Top 5 largest categories:
| Category | Number of startups | Participation (in %) |
| Credit | 477 | 18% |
| Payment Methods | 390 | 14.4% |
| Back Office | 323 | 11.9% |
| Integrated Financial Platforms | 308 | 11.4% |
| Digital Services | 287 | 10.6% |
Investment by category:
| Category | Investment Volume (US$ billion) | Number of deals |
| Digital Services | 5.3 | 195 |
| Credit | 3.1 | 380 |
| Payment Methods | 2.3 | 192 |
| Integrated Financial Platforms | 1.1 | 180 |
| Back office | 0.8 | 168 |
| Others* | 3.0 | 543 |
Current Trends in the Sector
The Central Bank of Brazil has been responsible for major changes in the segment. Among the most recent is the proximity PIX transaction in partnership with Google Pay and Apple Pay, expected for this year.
Another action of the Central Bank in 2024 is the regulation of Banking as a Service (BaaS), a public consultation scheduled to define guidelines for this new way of offering banking services. In addition, the institution has been involved in implementing financial education programs in banks, aiming to increase citizens’ knowledge and awareness of financial responsibility. The movement was identified by Distrito in the EdTech Report 2024 as a growing trend in the education sector.
Along with the PIX system, there is also Drex, a system still in the testing phase by the BC. Simulations involve an RWA (Real World Assets) token for operations between individuals, companies, and B2B transactions. In the legislative area, the latest changes allow Brazilian fintechs to calculate Income Tax (IR) based on presumed profit, potentially reducing the tax burden by up to 50%, making the national financial market more competitive to promote the creation of financial services startups.
Open Finance was another important change that came to guide financial institutions in the implementation and supervision of the service. The new interactions in the first half of this year, with integrations, customization, and information security, show advancements and improvements in the process of sharing financial data.
Main Trends
The FinTech sector plays a pioneering role in adopting new technologies, particularly driven by the adoption of AI. Among the AI startups in Latin America, 83 are fintechs, according to the Emerging Tech Report 2024, conducted by Distrito. Generative AI is another recent trend that could add between $200 billion and $340 billion to the global banking sector annually, improving customization for strategic decisions.
Transformations in the segment also include tokenization, a market that is expected to grow from $6.8 billion in 2024 to $23.4 billion by 2032, according to Market Research Future. The trend remains on the BC’s radar, which prioritizes the regulation of asset tokenization.
Banks and fintechs are expanding their services beyond traditional financial transactions. For example, Nubank offers Nubank Shopping, an online shopping platform with discounts and cashback. “By following and adopting trends, the national and Latin American market is stimulated to become more dynamic and inclusive, facilitating the creation of new innovative and personalized solutions that may arise,” Gierun concludes.
