Costa Rica: Fintech’s rapid expansion
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Costa Rica: Fintech’s rapid expansion

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Catarata del Toro waterfall with surrounding mountains in Costa Rica

The fintech industry has revolutionised the traditional financial industry as we used to know it, at a faster pace than many could imagine.

The rapid growth of the fintech industry reveals itself in numerical terms but also in a variety of areas. It is embraced not only by start-ups, but also by the traditional players of the financial sector that recognise the need to digitalise and open their business models, and by regulators that seek to provide safety to the users of these fintech solutions. Hence, the use of digital technology to innovate in the financial sector went from being a competitive advantage, to a demand of users.

Costa Rica is no stranger to this phenomenon. Its leadership in the region in mobile penetration along with its ability to train, attract and retain talent mean it is a fertile ground for the emergence and expansion of fintech solutions. This is highlighted in the recently published report (July 2019) of the Inter-American Development Bank (IDB) and through its privileged position in the global innovation rankings (second place, according to the World Innovation Index).

Technological innovation in the financial industry is presented as an opportunity to digitalise and formalise different businesses in Costa Rica, as well as to grant access to financial services to a large population that has historically been excluded from the traditional banking/financial sector. This has led to a more transparent, democratic and inclusive system.

The IDB identified 25 new fintech start-ups in Costa Rica corresponding to the following segments: a) technology services companies for financial institutions (ETIF): the largest segment, with 10 startups, 40% of the total, b) payment solutions: with eight startups, 32% of the total, c) alternative financing platforms: with three startups, 12% of the total identified startups, d) enterprise finance management: with three startups, 12% of the total, and, e) alternative scoring: with one startup, four percent of the total.

The report also highlighted the main destinations where the Costa Rican fintech startups have expanded their operations, which include also countries such as Guatemala, Panama, Nicaragua, Mexico, Colombia, Argentina, Brazil, Chile, and the US.

While Costa Rica is at the forefront in the development of the fintech sector in central America, there are still many challenges ahead to be overcome in order to allow the fintech sector to grow even faster and with more regulatory certainty.


Mario Quesada


Ana Carolina


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