What opportunities did you identify to create a fintech company in 2018?
In 2001, I founded a company with my brothers in the call center sector selling credit cards. We experienced sustainable growth until 2008, when the financial pandemic hit. The US economy halted, and we reinvented ourselves to become an issuer of payment methods. At that time in Mexico, there was an oligopoly of French companies providing that service, but there was room in the market to enter. We were able to disrupt the market by reducing prices and offering better post-sale service. Since then, we have experienced rapid growth. We started moving USD10 million; today, we move USD1 billion because we saw an opportunity for Mexican companies to start using this prepaid system. Originally, it was a product mostly for companies. However, now we are focusing on people. We did not know that there would be the 2018 Fintech Law, which has created a broader scenario than what we wanted.
Why did Toka decide to establish an assertive investment decision during the COVID-19 pandemic?
We did not choose the crisis, but the crisis chose us. Businesspeople have to adapt to changing scenarios. The product changes, but evolution is necessary. When you launch a company, you do not know in which direction it will head, but it is important to move forward and seek opportunities. In 2008, our business experienced an economic blow, but we reinvented and diversified ourselves. We have performed excellently: we have a great product and a great payment method company, and we do not have the costs of a French corporation. Today, the challenge is different, and Toka has made huge changes to continue supporting its clients. With our investment in Toka Fintech and Accendo Bank, we have a different financial expectation for the unbanked, and we are convinced we will change the way of doing business in Mexico.
Why did Toka decide to invest in Accendo Bank?
Toka has its plans and it needed strength. We have joined forces with a bank, as we saw the business potential in that fintech bank. This particular financial institution seeks to be the largest fintech bank in Mexico. As we are an issuer of cards, joining forces with a bank is a great opportunity to cater into the unbanked. Some 13% of financial transactions in Mexico are though payment methods, while 87% are through cash. With this investment, we want to serve the unbanked and help the informal sector. We want to serve the markets and the local markets. Through this merger, we will offer the population the possibility of banking themselves in five minutes. Through our new, easy-to-use app, people can not only sign up for bank accounts easily, but it will facilitate transfers and better support clients. This bank account offers access to a world that people did not have access to before. Mexico is a country growing in terms of smartphones. We also have an innovative and technology concept to be launched in 4Q2020. We expect to increase Mexico's banked population. We have merged our company with the bank to offer a real and regulated project. In addition, the bank will change its name to Toka Banco. However, there are some strict regulations that we need to follow to do so.
What opportunities are there for Mexico in the global restructuring of the financial market?
There are applications in developing countries that have rapidly grown and expanded. There are many technologies for early adoption. Today, the pandemic has shown how the future has changed. People have learned to hold video conferences; it is obvious we need tools that can make lives easier. I expect to see deeper digital transformations, and those banks that do not take part in these changes will struggle. But this is a process of the patient.