Challenger bank Stori raises $32m to boost Mexico’s digital financial services

Digital bank Stori closed a $32m Series B funding round to fuel the credit card payment industry for masses in Mexico.

Lightspeed Venture Partners led the latest financial round, with existing backers including Vision Plus Capital, BAI Capital and Source Code Capital also participated in the investment.

With the company’s new capital, Stori’s total funding raised comes to around $50m since its launch in 2018.

The key objective driving the company is to enable Mexico’s mass consumers – particularly the younger generation – with a mobile-first user experience so they can easily make digital payments – online and in-store, manage short term or emergency cash needs and build a credit history.

Currently, less than 15% of Mexico’s adult population have access to a credit card as the middle-class part of the population do not have a solid credit history and most banks haven’t caught up with the digital transformation, the firm said.

This gave the firm an opportunity to fill the financial gap in the country. After Stori launched its credit card product in January 2020 with a fully-digital in-app process that does not require an applicant to visit a branch, it has already had more than one million customers apply for a card.

Given how Mexico topped the list of the world’s fastest-growing e-commerce markets according to a study by Pattern, the demand for paperless payments is indeed on the rise making the country ripe for fintech services.

Commenting on how the banking industry has underserved Mexico’s mass population, CEO and co-founder Bin Chen said, “Our goal is to become a leading digital bank for the underserved population in the region.”

Chen added, “By tailoring global best practices in underwriting, technology and user-friendly design, combined with rapid iterations, we’ve found the right formula to deliver a compelling product and experience to the large underserved population in Mexico.”

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