BPC Banking Technologies outlines LatAm growth opportunities, challenges

BPC Banking Technologies has Latin America in its crosshairs.

The Swiss-headquartered global solutions company, which processed US$2tn in US dollar payments in 2019, is betting big on the fact that financial inclusion levels in Latin America are low but smartphone penetration high. 

Cash has traditionally been king in the region but the COVID-19 pandemic has given digital payments a turbo-boost as people, because of necessity or fear over contagion, have entered the brave new world via solutions delivered by incumbent financial institutions, fintechs and e-commerce platforms keen on serving this growth seam.

To find out more, BNamericas spoke with Santiago Egas, executive VP at BPC.

The company provides a portfolio of solutions, chiefly geared to financial services sector players, encompassing areas including digital banking, merchant acquiring, APIs, e-commerce, payment switches, automated fare collection and fraud risk management.

BNamericas: What are your goals or plans for the rest of the year?

Egas: This year clearly demonstrates how digital payments are on the rise in these times of pandemic and how organizations must respond quickly through the use of technology. Therefore, we expect to double our revenues by 2023 and we think that SaaS services in the cloud will represent more than 80% of our activities.

More and more companies are turning to SaaS (software-as-a-service) models, consuming the services they need and launching new services much faster. We have a dedicated SaaS company, Radar Payments, serving clients in the sphere of end-to-end banking and payments, as well as fraud prevention needs in a SaaS model. 

Key areas for growth continue to be digital banking, retail payments, the shift to contactless technology, and the rise of e-commerce. We enable financial institutions, banks, and [payment service providers] PSPs to take their business and commercial customers online or drive digital payment acceptance.

In addition to this, we have launched new businesses such as o-city, our smart city company, which is at the heart of the digital transformation of the mobility sector. Public transportation is shifting to open-circuit technology that allows customers to pay for their transportation ticket, parking or toll using their mobile phone, a contactless card, [digital] wallet, QR code or facial recognition, allowing them to pay the way they want. We are also seeing governments turning to digital for subsidy disbursement and tax collection, which is another area that we are developing.

BNamericas: What are the digital payment challenges in the region?

Egas: Digital payment technology has been key to keeping the economy moving in a context of fewer face-to-face interactions. In Latin America, among those with bank accounts, 84% of people believe that contactless payment is the most hygienic method when acquiring, or paying for, a product or service, which is why this payment method has become an important actor in this new scenario. 

What we have experienced, on account of COVID-19, has accelerated the migration to digital payments. And national payment entities, as well as service providers and merchants, need to accelerate their digital payment programs. Methods such as QR codes or facial recognition can contribute to the development of commercial and financial ecosystems very quickly and boost the economies of the countries of the region.

At BPC we believe that one of the great challenges of digital payments is the implementation of new models of payment experiences through facial recognition, digital wallets or integrated payment systems. Here, governments and state authorities play a fundamental role in promoting this type of technology, to allow people, regardless of where they are located, to have access to digital channels to conduct operations and, therefore, be able to address their financial needs.

BNamericas: What opportunities are there for companies that are thinking of entering Latin America?

Egas: We are sure that the use of digital channels will continue its exponential growth, causing a continuous displacement of cash. Companies, SMEs and individuals will seek new ways to sell their products and services, supported by digital platforms that allow them to collect without contact.

Digital wallets are on the rise, so we will see more fintechs entering the market. In addition to this, the need to provide value beyond digital payment is palpable; therefore, we will be able to witness the rise of ‘super apps’ and e-commerce giants, who will continue to attract consumers. We also see that financial institutions are thinking about building important ecosystems beyond digital banking.

The opportunity to promote financial inclusion via technology is a reality. A study published by the GSMA, an organization that represents mobile operators around the world, highlighted that, at the end of 2020 in Latin America, 70% of its population had a smartphone; this means that there are 440mn enabled devices. This is a tool that, thanks to digital transformation, brings people closer to financial and transactional services.

BPC has a digital ecosystem that promotes financial inclusion and contributes to solving the problems that people experience in their daily lives. For example, the SmartVista platform offers solutions in areas such as digital banking, ATMs, contactless payment processing, card and fraud management, financial inclusion, commercial portals, transportation, and smart city. Being designed organically, it is configured so that solutions integrate and are focused on meeting the specific needs of customers.