The limits to FinTech unveiled by the financial geography of Latin America

Bibliographic Data

ID8945189
AuthorsStella Ioannou (0000-0003-2042-302X, Oxford Brookes University), Daniel Wojcik (0000-0003-2158-284X, University of Oxford, corresponding author), Dariusz Wójcik (0000-0002-4200-3432)
Year2021
Volume128
Pages57-67
Publication date2021-12-07
Peer ReviewedYes
Open AccessYes
TypeARTICLE
VenueGeoforum (JOURNAL)
Journal identifiersISSN: 0016-7185 • E-ISSN: 1872-9398
PublisherElsevier BV (PUBLISHER)
DOI10.1016/j.geoforum.2021.11.020
OpenAlexW4200515317
LanguageEN
Citations received15
References cited30

To address the paucity of research on the financial geography of Latin America and contribute to the emerging geographical literature on FinTech, we use quantitative financial data and qualitative insights from expert interviews, to explore the relationships between FinTech development and financial geography of the region, with focus on Brazil, Mexico and Argentina. We show that despite its fast growth driven by high costs of financial intermediation, policy of financial inclusion and financial regulation, FinTech in Latin America has thus far played out on the margins of the global FinTech industry and the margins of its financial systems, with limited impacts on financial inclusion. We argue that FinTech has not challenged but contributed to an already high level of concentration in the geographies of financial services in Latin America. This is affected by the proximity of FinTech firms to incumbent banks (which are active in FinTech), sources of capital and skilled labour, and reinforced by the fact that leading financial centres in Latin America are also the main centres of technology industry. Finally, we demonstrate that FinTech has not yet had a significant impact on the low level of financial integration in Latin America, with fragmentation determined by political, economic, and financial instability, combined with a lack of compatibility in financial regulation. Put together, our findings add to the literature that advocates a degree of scepticism about the impacts of FinTech on financial centres, if not the financial system overall

Business · Economics · Financial inclusion · Financial innovation · Financial intermediary · Financial market · Financial regulation · Financial services · Financial system · Fintech · Geography of finance · Latin Americans · Political science · Finance · FinTech, Crowdfunding, Digital Finance · Microfinance and Financial Inclusion · Sharing Economy and Platforms