Uala, An Argentine Fintech Company, Introduced its Brokerage Service
Uala, an Argentine financial services startup, is introducing its broker-dealer to expand the investment alternatives available to its customers via its wallet app.
It will be called Ualintec Capital and will begin operations on Tuesday. Allowing some users in the South American country to buy dollars using a parallel rate known as “Dolar MEP” in the local language. According to CEO and Founder Pierpaolo Barbieri. It intends to allow users to buy Cedears. Which are depository receipts of US stocks, and launch its funds in early 2022.
As the region’s middle class wants more sophisticated financial services. In its most recent financing round, Uala had valued at $2.5 billion. It is one of a flurry of fintech businesses going up against brick-and-mortar banks. In Argentina, where yearly inflation exceeds 50%. A feature that allows Uala users to invest cash in their electronic wallets into a money-market mutual fund quickly gained traction, with 1.3 million of the 3.5 million users opting in.
Clients will be able to invest in the money-market fund. Which has been available through a collaboration with local broker SBS Asset Management SA since November 2019. Barbieri now wants his users to invest in his products.
“We want to complement that with offerings that may offer a better return or a different risk profile,” he said in a phone interview. With Uala hosting more than 30% of all investment accounts in Argentina. “why would we give that business to another brokerage?”
The buying of greenbacks through a series of bond operations known as “Dolar MEP” has grown in demand in Argentina. Despite the government’s strict capital controls, limiting savers to only purchasing $200 per month through official channels to protect foreign reserves. These purchases are likewise severely taxed. The MEP exchange rate is over 200 pesos per dollar, more than double the official rate of around 100 pesos per dollar.
Ualintec has a dedicated team of roughly 20 individuals, managed by Uala’s head of wealth management, Andres Rodriguez Ledermann. The normal Uala app will allow users over 18 to access the investment options.
As part of a marketing strategy, the company announced that it would buy a bank in Argentina and another in Mexico. Allowing it to obtain a banking licence in each nation after local regulators finalize the acquisitions. Barbieri would not comment on the status of those approvals.
Last week, the organization also announced that it was expanding its loyalty programme in Argentina to all customers and adding new features. Including an association with American Airlines that will allow users to collect frequent-flier miles.
SoftBank Group Corp., a Japanese corporation, and Tencent Holdings Ltd., a Chinese Internet juggernaut, sponsored the company’s most recent $350 million Series D investment round. Among the company’s investors are George Soros, Steve Cohen, and Goldman Sachs Group Inc.
Ualá is a personal financial management mobile app established in Argentina linked to a Mastercard prepaid card. And allows users to execute financial transactions in Argentina and overseas, such as money transfers, payments, and purchases.
Pierpaolo Barbieri founded this neobank, which began operations in Argentina. Where mobile phone usage is 92% and banking penetration is 50%. Users of Ualá can manage their money without having a bank account by using their phones.