According to Pierpaolo Barbieri, Argentina is a country where young people would prefer to visit the dentist than to go to the bank. More than half of Argentina’s population is excluded from traditional financial institutions and few efforts have been made to help the middle class access services like savings and credit. My guest on the podcast today is Pierpaolo Barbieri, the founder and CEO of Ualá, the first fully-mobile and free bank card for the Argentinean market, which is trying to bring financial inclusion to Latin America’s second largest economy.
We talk about Ualá’s efforts to serve the underbanked in Argentina, the financial environment in Latin America, Pierpaolo’s background studying in the US and the UK, and why he has decided to maintain Ualá as a free service for all customers.
Tackling Argentina’s financial landscape from a local perspective
Argentina has a uniquely complicated banking environment with constantly changing regulations and a thriving black market in foreign exchange. This is a country where over 50% of people have never owned or used a credit card, because banks have little way to analyzing credit. While mobile neobank models are well-known in Europe, Pierpaolo does not believe in fully copying the model. Find out more about how Pierpaolo built Uala to specifically serve the Argentina in this episode of Crossing Borders.
The benefits of an international liberal arts education
Pierpaolo studied a liberal arts curriculum before starting to innovate in the banking sector. In fact, he received more pushback from his family when he went to study history in the US than when he founded a fintech company in Argentina. However, Pierpaolo credits his liberal arts education with giving him the background he needed to understand the finance industry. Find out how Pierpaolo’s history knowledge helped Uala reach clients in all 25 Argentine provinces faster than any established bank.
On a mission to make banks redundant in Argentina
Few people could understand why Ualá would offer a free card when people were already paying for debit and credit cards from banks. Yet after he launched the service, Ualá spread faster than even Pierpaolo expected. Pierpaolo credits the explosion to Ualá’s social mission; most users are thrilled to open their first ever bank account and the community is growing via word-of-mouth. Learn how Ualá plans to replace basic bank services by the end of next year, and why this mission has even caught Netflix’ attention.
Traditional financial institutions are still excluding the majority of Latin America and fintech startups like Ualá will likely be the answer to building financial inclusion in the region. Check out the rest of the episode to learn where Ualá is going next, and why Pierpaolo thinks US and European investors should be paying attention to Latin America.
Show Notes:
[1:16] – Nathan introduces Pierpaolo Barbieri and Ualá
[3:12] – An overview of Argentina’s complicated financial environment
[6:32] – Global mobile credit card models from Europe that inspired Ualá
[8:46] – How not studying finance helped Pierpaolo start a finance business
[10:46] – What are the culture shocks of crossing borders?
[11:38] – You need to create a product that fits for the place
[12:30] – Advice for LatAm founders looking to raise capital from abroad
[15:20] – Did you always know you would be an entrepreneur?
[18:10] – How Ualá’s social mission has been crucial to its expansion
[21:07] – How to set up a fully-mobile lending scheme in Argentina
[23:50] – Next steps for Ualá: making banks redundant
[26:08] – Advice Pierpaolo would give to himself before founding Ualá
[28:18] – Advice for foreign investors who are considering investing in Latin America
Resources:
- Ualá
- Zero to One [Book]
- The Ascent of Money [Book]
- The Lords of Finance [Book]
- Hitler’s Shadow Empire [Pierpaolo’s book]