- According to Ualá’s statement, Eduardo Eurnekian and Corporación América, that has investments in Argentina, Armenia, Brazil, Uruguay, Ecuador, Italy, and Peru, will provide a solid platform for the expansion of Ualá;
- It will give the fintech the possibility of strengthening its financial ecosystem with a broader offer of services once Wilobank has been incorporated.
Argentina-based fintech Ualá will acquire the country’s first neobank, Wilobank, from the billionaire Eduardo Eurnekian, the company told LABS on Friday. The deal is a step further to Ualá consolidation as a neobank in Argentina. Yet, it is pending Argentina‘s Central Bank authorization.
Eduardo Eurnekain is the founder of Corporación América. He agreed on a strategic partnership whereby the fintech founded by Pierpaolo Barbieri acquires 100% of the shares of Wilobank. On his behalf, the billionaire will join Ualá as an investor, alongside the fintech‘s current international partners, like SoftBank.
READ ALSO: Argentina’s fintech Ualá doubles the number of cards issued in 10 months
Ignacio Carballo, Professor and Director of Fintech Ecosystem at the Universidad Católica de Buenos Aires, tells LABS that it is not yet known what this will entail in practice.
Weeks ago, another Argentina’s non-bank fintech Naranja X, an arm of the large group Galicia, got the license from Argentina’s Central Bank to be a formal financial institution. They will change all clients’ registration and start offering banking services from CVU to CBU. But what is that?
BCRA (Spanish acronym for Argentina’s Central Bank) created a Uniform Virtual Key called CVU, allowing users to make money transfers at no costs between banks and digital accounts. The CVU registration works for the unbanked population, while the CBU key is destined for those who have bank accounts. “In September, a company of the Galicia group started a journey to be a financial institution. BCRA approved it, and now Naranja X announced they will change the company to this new license,” comments Carballo. For now, he says that it is not possible to know if Ualá is going to change it to a banking license.
According to Ualá’s statement, Eduardo Eurnekian and Corporación América, which has investments in Argentina, Armenia, Brazil, Uruguay, Ecuador, Italy, and Peru, will provide a solid platform for the expansion of Ualá, giving it the possibility of continuing to strengthen its financial ecosystem with a broader offer of services once Wilobank has been incorporated.
READ ALSO: Argentine fintech Ualá begins its expansion across Latin America with the launch of operations in Mexico
A Nubank’s rival on the horizon?
According to Ualá, once the deal is approved, its users will keep their digital accounts and the services they already have. In the same way, Wilobank users will keep their services and current conditions.
The firm stated that this agreement will allow Ualá to add Wilobank’s proposal to the ecosystem and offer different solutions, furthermore than just banking.
Recently, Ualá began to operate in Mexico, where it hopes to replicate the success it has been experiencing in Argentina. In 2020, it doubled the number of cards issued in 10 months, from 1 million to 2 million. Wilobank, in its turn, issued 105,454 debit cards and 66,294 credit cards until September 2020, according to data from BCRA.
It is still a distant number from Nubank, which has 35 million customers. Still, it means more competition for the Brazilian fintech as it is looking at the same markets in the region (this week, Nubank announced an investment of $135 million in Mexico).