How Wise captured 25% of Brazil’s cross-border market (and what it reveals about fintech’s future in LATAM)

While attention often focuses on developed markets, the most exciting fintech innovations are emerging where mobile technology, young digital-native populations, and gaps in traditional banking converge. These regions aren’t just adopting Western models – they’re creating entirely new paradigms that may eventually reshape global finance.

Today I’m joined by Nadia Costanzo, Director of Banking for the Middle East, Africa, and Latin America at Wise. Nadia drives Wise’s expansion across these regions by building banking relationships, securing licenses, and navigating complex regulatory frameworks.

Her background is uniquely valuable – before Wise, she worked with Kiva in Nairobi facilitating microfinance across Africa, contributed to the World Bank’s Universal Financial Access agenda, and worked directly with microfinance institutions in Paraguay.

Today, we’ll explore how fintech evolves differently across emerging markets, examine key challenges, and discuss surprising innovations where traditional banking is limited. We’ll also consider what these developments mean for established financial institutions looking to engage with these dynamic markets.

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Focused expansion in LATAM’s diverse markets

Latin America is often viewed as a unified market, but Nadia breaks this perception. Each country presents unique opportunities and regulatory conditions. Wise currently operates in Brazil, Mexico, Chile, Colombia, and Costa Rica. It prioritizes depth over breadth. “Whenever we choose a market, we want to be able to ensure that we offer our whole product offering to the customers over there,” she shares.

A key driver for Wise’s regional strategy is customer demand for cross-border services. In Brazil, Wise holds approximately 25% of the market share in cross-border transactions. “That’s because we’re offering a more convenient product. It is more transparent and less costly than traditional financial services,” Nadia explains.

Regulation and Collaboration: Navigating the fintech landscape

The regulatory landscape in Latin America is actively evolving, and Wise is growing with it. Countries like Brazil and Mexico are building open regulatory frameworks. These support the growth of fintech partnerships. They also enable new entrants to offer services independently. “You see how they’re modelling their regulatory developments on each other rather than looking only to the Global North,” says Nadia.

Wise recently secured its second payment institution license in Brazil. This granted access to PIX, the country’s instant payment system. Nadia points out that this has dramatically changed consumer expectations. “Brazilians wouldn’t understand why you wouldn’t offer PIX. It’s that embedded in everyday use now.”

Fintech and Banks: From competition to cooperation

Instead of direct competition, Nadia observes increasing collaboration between banks and fintechs. Wise depends on local financial institutions for payment execution in some markets. Those institutions rely on Wise’s international infrastructure in return. “Partnership has always been part of our model,” she says. “We offer something to them, and they offer something to us.”

This approach echoes the banking-as-a-service model. It is particularly useful for SMEs and micro merchants seeking digital tools for cash flow management. Banks are also responding by creating their fintech branches or collaborating with firms like Wise. They are doing this to reach digitally native customers more effectively.

Financial inclusion and digital accessibility

While Wise currently serves mostly banked users, the broader vision involves expanding access. “Hopefully that will change,” Nadia adds. She talks about reaching unbanked populations in LATAM. This goal is becoming more achievable as smartphone access and digital literacy grow.

The trend toward small business digitization is also contributing to greater financial inclusion. “People want extreme speed—instant payments, seamless transfers. That’s driving adoption,” she says. Wise’s presence is helping local economies, especially SMEs. It helps them to gain access to transparent cross-border tools. It bypasses traditionally complex and costly banking methods.

Building local teams, strengthening local economies

Wise’s model is deeply rooted in local presence. In Brazil alone, the company has over 200 employees. “There’s no one who knows the ins and outs of how to operate in these places like local people,” Nadia emphasizes. Local hiring ensures that Wise can navigate regulatory uncertainty. It allows them to better serve communities in line with cultural expectations.

She also highlights a growing fintech ecosystem in LATAM. It is supported by fintech associations. These allow players to share challenges and regulatory concerns collectively. This collaboration is essential to ensuring long-term growth. It ensures safety and cybersecurity within the region’s digital banking systems.

There’s more work to be done (and opportunities to grab)

LATAM’s fintech ecosystem is becoming more connected and user-focused. In response, Wise is expanding its services. They’re building strong infrastructure for cross-border payments. They are focusing on digital banking as well as support for small businesses. Wise has obtained new licenses and is forming stronger partnerships. This helps them expand their services across Latin America. They can now offer both global reach and local understanding to their customers.

As Nadia notes, the work is far from over. “I’m excited to bring our global products to customers in the region,” she says. And with 2 million cards issued in Brazil alone, the appetite for better financial solutions is clear—and still growing.

The Big Ideas

  1. Each LATAM market is a unique opportunity. “We tend to go deep in the markets that we operate in.” Wise targets specific countries rather than treating LATAM as a homogenous region.
  2. Regulation is opening doors. “You see how they’re modelling their regulatory developments on each other.” Governments are enabling fintechs through open payment systems and licensing.
  3. Fintechs and banks need each other. “We need partners, but increasingly, they also need Wise.” Mutual dependencies are shaping a new model of embedded finance.
  4. Financial inclusion starts with accessibility. “You need to have access to the banking system and a smartphone.” Current users are mostly banked, but Wise is positioning itself for broader reach.
  5. Local teams build better products. “No one knows the ins and outs like local people.” Hiring regional talent helps navigate unwritten rules and strengthens market fit.

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Tradestreaming Panorama (week ending September 18, 2011)

Every week, I send out an exclusive email (free) to my subscribers summarizing the events of the past week.  It’s everything about the intersection of technology, social media and investing.

Sign up in the sidebar, at the end of this post, or by going here.

Bogle’s Blunders, intellectual honesty and historical perspective (Dorsey Wright):
To the guys at technical analysis shop, Bogle appears as a rigid idealist and someone unwilling to admit that his ideas might have seen their time.  Apparently, Bogle believes investors only misuse ETFs and not index funds.

Should investors overweight companies with overweight CEOs? (Time):
Turns out fat CEOs equal fat profits according to a study in Psychological Today. There seems to be correlation between the width of CEO faces and financial performance. It’s like going long blockheads — but hey, the study posits all types of reasons for this (aggressiveness, imposing people don’t get as much pushback, etc.)

Continue reading “Tradestreaming Panorama (week ending September 18, 2011)”

How to invest in emerging markets as a foreigner [free ebook]

How does a foreigner invest in some of the most compelling emerging markets in Asia and the Middle East?   Which geographies should investors be looking seriously at?

I don’t know — but Saudi Price Alaweed does.  And recent guest on Tradestreaming, Jeff Towson does. See my interview with Towson here and here.

He’s also written a book about global investing, What Would Ben Graham Do Now: A New Value Investing Playbook for a Global Age.

He was head of direct investments in the Middle East and Pacific for Alaweed’s barebones (staff of 2 or 3 people), multi-billion dollar, global investment machine.

The Tradestreaming global investing ebook

Continue reading “How to invest in emerging markets as a foreigner [free ebook]”

The Emerging Markets Blueprint for Investors

As the U.S. continues its internal struggles over the financial direction of the company, investors are focused overseas more and more.

Why?

That’s where the growth is.

Well, and it’s also getting easier to access emerging markets with new funds, strategies, research, etc.

I wrote a post over at Wealthfront about ways to access emerging markets beyond BRIC.

And it got me thinking — I could use a one page investment resource for emerging markets.  So here that is… Continue reading “The Emerging Markets Blueprint for Investors”

How Saudi Prince Waleed invested globally and grew $30k to $22B — with Jeffrey Towson (transcript)

tradestream radio, discussing investing and technology

On Tradestreaming Radio, we’re interviewing lots of innovative entrepreneurs, investors, and researchers all trying to make investors better at what they do. Check out our archives. Subscribe on iTunes. The podcast itself can be heard in its entirety here.

Transcript purchased from SpeechPad

Announcer: Live from the Internet, it’s Tradestreaming Radio, with your host, Tradestreaming.com’s own Zack Miller.

Zack: Hey, this is Zack Miller and you’re listening to Tradestreaming Radio, our place on the Internet where investors learn directly from experts. We’ve got a great show today. We’ve got Jeffrey Towson, the author of “What Would Benjamin Graham Do Now?” Towson was Head of Direct Investments, Asia Pacific and Middle East for Prince Waleed of Saudi Arabia, who is the world’s fourth wealthiest person. He manages a portfolio of over $22 billion, and Towson worked for him for many years, having grown up in the States. Lived overseas and was very much involved in direct investments, buying up properties, investing directly into companies.

His book is a really interesting take, because for many years, obviously, U.S. investors have recognized that there is the rest of the world, and it’s getting more and more interesting. Unfortunately, the way we do it is somewhat, according to Towson, very contorted. Buying a multinational that has exposure to the Middle East is one way to play this game, but obviously not the best. So, in his book, he lays out sort of a framework for investors of any sort, whether they’re retirement investors or professional investors, private equity guys, hedge fund managers, who really want to understand and learn from a framework of how to do business in the Far East. He lays it out in this book.

It’s a very good book. The book, in fact, is probably more suited for the classroom, but it was a very informative read. Lots of interesting anecdotes, and to me, the most interesting thing about the entire enterprise is how Waleed grew his business from a $30,000 loan from his father into a $22 billion investment portfolio, really with two or three staff. It’s a bare bones operation, yet he has his hands in investments all over the world. Being able to understand that model, to me, was really one of the most interesting takeaways from this book. Continue reading “How Saudi Prince Waleed invested globally and grew $30k to $22B — with Jeffrey Towson (transcript)”

How Saudi Prince Waleed invested globally and grew $30k to $22B — with Jeffrey Towson (podcast)

building an investing empire

Saudi’s Prince Waleed took $30k and investing globally, turned it into $22 billion — all with staff of only 2 or 3.

by Jeff Towson

He was able to accomplish this by applying a framework to invest globally. Like Buffett, Waleed is a value investor. But the similarities end there — Waleed is a deal maker, on the prowl to see where he can add value and how.

In this podcast, we’re joined by Jeff Towson, who was Head of Direct Investments Middle East/North Africa and Asia Pacific for Waleed** for almost 10 years. He’s written a new book describing the Waleed model, What Would Ben Graham Do Now: A New Value Investing Playbook for a Global Age. He explores the essential question of our day: how does a foreigner properly invest in emerging markets? Continue reading “How Saudi Prince Waleed invested globally and grew $30k to $22B — with Jeffrey Towson (podcast)”