Oxxo, the ubiquitous convenience store chain owned by Coca-Cola bottler FEMSA, is not just a retailer of products such as beer, soda, chips and cigarettes but also a major player in Mexico’s burgeoning fintech sector.
Spin by Oxxo, an app launched last November that can be used to send and receive money, currently has 4 million users, but that number is predicted to grow quickly over the next 12 months.
Asensio Carrión, Spin by Oxxo’s general director, told the news agency Reuters that the fintech product — which also comes with a Visa debit card — is set to reach 10 million users next year.
“The porosity we have allows us to reach more distant places and offer services where there are none,” he told Reuters. “We are in every Mexican state.”
According to the Spin by Oxxo website, users can send money to other Spin accounts, regular bank accounts and to people without bank accounts. In the latter case, the recipient can withdraw the money at one of Oxxo’s more than 20,000 stores across Mexico.
The website says that users can deposit money to their own Spin account via the app, a bank account or in Oxxo stores.
Oxxo charges commissions for some, but not all, transactions. It costs five pesos to make a cash deposit at a store, for example, and 12 pesos to withdraw money at the same location. A debit card costs 50 pesos.
Reuters reported that 60-65% of Spin’s users are active, meaning they’ve made a transaction or received money in the past 56 days.
The service, which FEMSA financed itself, has more customers than Latin America’s largest fintech bank — Brazil’s Nubank, and Mexico’s Stori. However, Banorte, a traditional Mexican bank, has more digital clients, reporting 6.7 million earlier this year. Banorte was recently granted approval to operate a 100% online bank, a development the bank says will help it strengthen its position as a digital leader in the Mexican banking market.
Spin by Oxxo was granted a new license to operate as a financial technology institution earlier this month, Reuters reported, adding that users will now be able to receive remittances from abroad.
The news agency also said that FEMSA is seeking permits that would allow Spin users to deposit larger sums of money and receive their wages. Carrión said that Spin could be rolled out in other countries in the future.
Fewer than 50% of Mexican adults have a bank account, official data shows, although the government is seeking to increase that number by building large numbers of state-owned “well-being” banks, including branches in isolated communities where there are no traditional banks.
With reports from Reuters