examples in the region, reporting more than 1 million customers and cumulative transactions close to $1 billion. The Mexico-based fintech announced it had already disbursed 6 million loans as of this month and that its BNPL product was already offered by some 2,000 merchants and 600 brick-and-mortar stores in the country. Founded in 2012 as an online consumer lender, the branchless company had previously raised $202 million in both equity and debt financing in late 2021 in a bid to grow the budding BNPL business model in the region. The growing success of Kueski marks rising interest from Mexicans in the Buy Now, Pay Later system, which comes as an alternative to short-term bank financing. Its popularity has grown worldwide, particularly on the back of e-commerce sales, as loans are usually linked to a specific good or service. Through BNPL, users settle their purchases at a future date by taking loans directly from e-commerce platforms without ever using a card.
The rise of e-commerce during the years of the COVID-19 has contributed to its developing popularity in Latin America. Beyond e-commerce arrangements, BNPL serves another goal in Latin America: including more people in the financial system. They do so by making financing more accessible. It is typically the case that BNPL providers would not require a credit history for the customer to apply for a loan. In that regard, Mexico provides excellent opportunities to deploy a BNPL business model, Kueski argues, as the share of the unbanked population is one of the largest in Latin America. World Bank data from 2018 showed that less than 40% of adults had or actively used a bank account.