Meet Bankaya, a Mexican fintech that is going offline for customer acquisition – TechCrunch

Most fintech companies pride themselves on everything digital, including their customer acquisition strategy.

But Bankaya, a Mexico City-based financial services startup, attributes its early appeal to the opposite model — going after target customers personally.

Founded in 2019 by CEO Mauricio Cordero, Ramon Chedroy and Diego Vargas, Kaya Bank which was launched one year ago and is proud of having 450,000 customers till the end of the year. Impressively, and perhaps unexpectedly, most customer acquisition has been via offline channels.

Bancaya’s target customers are 50 million unbanked in Mexico. The startup has made it its mission to drastically lower that number with what it believes is a unique approach.

“We realized we couldn’t access this part digitally. We have to go offline, head-on,” he told TechCrunch. “Especially because many of our target customers live in rural or remote areas, and do things like Save money under the mattress.”

Literally, Bankaya’s sales team works on the streets, even setting up shop in places like supermarkets and vaccination centers surrounded by stalls full of discount cards.

“disadvantaged “They need a lot of hand holding, someone in front of them explaining to them how to use the card, for example, or how to send money to the family,” Cordero said. “They are usually inactive online and won’t download an app from Facebook or Instagram.”

That human participation works miracles. In December, Kaya Bank processed more than 800,000 transactions from customers, including purchases, deposits, withdrawals, bank transfers and service payments. That’s up from 500,000 in October. The target population has an inherent mistrust of traditional banks, hence the strategy of talking to people face-to-face with the goal of alleviating some of this reluctance.

“We work with customers who aren’t really bankable,” Cordero explained. “So we are building trust and financial education. The human factor in these cases is very important. Just really critical. And this impact agenda is our competitive advantage.”

Cordero estimates Bankaya’s CAC (Customer Acquisition Cost) is about $4 per account opened – likely significantly lower than those of most fintech companies and traditional banks.

“Every digital bank in Mexico spends millions on Facebook and Google Ads, and that drives up acquisition costs,” he told TechCrunch. “They all go after the same customer, and in a very expensive way that leads to low quality conversion rates and engagement.”

Another important factor for Bankaya is the fact that it is built on the BaaS (Banking as a Service) platform. Cordero noted that there are only about 50 fully licensed banks throughout Mexico and the country rarely grants new banking licenses. “So you have an IFPE, or a governor, via fintech law.

“We’re in the middle,” Cordero explains. “We are one of the first BaaS platforms connected to one of 50 banks, and this has allowed us to have a really solid product. Fintech laws say IFPE is not allowed to touch consumer deposits – they can’t lend with them or share the proceeds. But we are allowed because we are using a BaaS license For Consubanco”.

Its application contains a free digital card for the user. The startup has a loyalty partnership with Chedraui, one of the largest retailers in the country. If Bankaya users purchase items in stores using their debit cards, they get 5% to 10% cashback on their Chedraui wallet. (Co-founder Ramón Chedraui is a family member who owns Grupo Chedraui.)

To date, 55% of Bankaya’s clients are women, and 59% earn less than the national average of $600 per month. Sixty-nine percent do not have a credit card. More than half of its customers are funded within the first three days of account opening, and they all receive a digital card upon sign up, according to Cordero. The startup is also offering a 2.5% return on deposits.

“Leadership of engagement is the name of the new banking game,” he told TechCrunch. “It can be difficult to monetize if customers don’t see real value. For Pankaya, it doesn’t matter who you are or where you come from, we want to help give people financial freedom so they don’t have to do things like walk for two hours to pay the utility bill” .

Meanwhile, over time, the startup will collect data that will only help in credit analysis in the future.

To date, Bankaya Bank is on the alert, with funding from its founders, two of whom do not participate in daily operations. It has about 100 employees and a sales team of about 300.

Bankaya is also launching a buy now, pay later system so that customers, through its app, can get credit installments. It will not work as a credit card and startup does not qualify merchants. Works directly with clients.

“They use the debit card to buy a product and pay the banks over time,” Cordero said. Unlike traditional buy now, pay later offers, startup charges interest.

“This is not Germany or the United States where you can offer BNPL at 0% interest. It is very difficult to do here,” Cordero said. “We have to charge interest but the idea is to graduate clients so that once someone pays for an item, they can fund the second item,” Cordero said. at a lower interest rate.”

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