FinTechs Go Global One Local Payment System at a Time
Digital platforms spread technology and product development across millions of customers, a model that makes adding another market attractive. However, international expansion brings more local infrastructure with it: licenses, regulated entities, bank relationships and connections to domestic payment systems. Recent moves by PhonePe and Revolut provide two examples. As reported last week,…
FinTech companies expand globally by adopting a strategy of building, partnering, or buying local payment systems. PhonePe, for instance, has sought in-principle approval from the Central Bank of the UAE for licenses to provide Retail Payment Services and Card Schemes, as well as Stored Value Facilities. The company plans to collaborate with regional banks and licensed payment providers, while also exploring connections to UAE’s instant payment platform and domestic card scheme.
Revolut, on the other hand, has obtained approval from Argentina’s central bank to acquire Banco Cetelem Argentina, which will become Revolut Bank Argentina. The company plans to establish its local operation after completing regulatory and operational preparations. The differing approaches of PhonePe and Revolut in acquiring or building local financial infrastructure highlight the importance of local payment systems in FinTech's expansion strategy.
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