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The remarkable growth of fintech in Uruguay has seen it rise 46 places to reach the top 20 global rankings in the Global Fintech Index 2021 edition.
64th place in the 2020 edition of the Index — only just making the 65-country leaderboard — Uruguay posted the most impressive rise in the latest IndexTo claim 17th overall.
Uruguay has now risen to the second spot on the Index, just behind Brazil, over Colombia, Mexico, Peru and Colombia.
SEE ALSO What are the Types of Legal Structures in Uruguay?
The country also now sits above the likes of Denmark, France, Japan, India, and New Zealand, among others — highlighting the impressive development of fintech in Uruguay and the bright future the country’s tech industry has.
According to Sebastián Olivera, the founder and first president of the Uruguayan Fintech Chamber, the country’s strong showing in the latest rankings highlights the potential that smaller economies have to emerge as tech hubs, as well as the strategic location that Uruguay enjoys.
“In the modern world, being a small country is no longer necessarily a disadvantage,” Olivera was reported as saying in the new report. “Any company founded here has one foot in the rest of Latin America and an eye on the rest of the world from the start.”
Uruguay’s Fintech sector is making waves following the debut of the unicorn
Uruguay’s impressive rise in the Index follows the country’s fintech industry attracting widespread attention among investors, after Montevideo-based electronic payments company dLocal saw its share price jump 48%After floating on the Nasdaq in May, trading began on the first day.
This saw dLocal reach a valuation of almost $9 billion (all figures in USD), becoming Uruguay’s first unicorn in the process. It attracted significant interest from other companies in Uruguay that specialize in fintech.
Other than dLocal and dLocal, the likes. Bankingly? Inswitch? MiFinanzas? Paganza, Prometeo.
They offer a variety of products, including digital channels, web-based tools and financial institutions, fintech for a service (FaaS), funding for businesses, electronic payments and open banking.
Uruguay is a developing market where Fintech thrives.
The Uruguayan market is among the most developed in Latin America. This makes it an ideal location for fintech growth in Uruguay. An estimated 60% of the country’s 3.5 million population is considered middle class, while the country ranks third in the region in the UN’s Human Development Index.
The country has a long history in economic and political stability. It also boasts one of the lowest rates crime in Latin America and Caribbean. Those factors combine with a secure and highly secretive banking system have seen the country widely referred to as the “Switzerland of South America”
The country is also a major trading hub and founding member of the Southern Common Market (Mercosur), a 30-year-old economic integration initiativThis includes Argentina and Brazil as well as Paraguay.
All of this has seen Uruguay emerge as one of the most prosperous nations in Latin America, registering a gross national income (GNI) of $16,230 in 2019 — a figure that places it as a high-income nation according to international standards.
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