The massification of mobile payments in the Andean country has led giants such as Yape and Plin to introduce payment services for companies, while the Federation of Municipal Banks (FEPCMAC) will launch a wallet aimed at serving the informal and rural sectors.

Informality, skepticism and incipient digitalization are some of the obstacles for the expansion of digital wallets in Peru. However, this did not prevent the rapid growth of these platforms in the years following the COVID-19 pandemic.

A report from the Peruvian Central Reserve Bank (BCRP) confirms the above. There were 146 million average monthly transactions through digital instruments such as wallets, transfers, credit and debit cards in 2020, but this figure reached 736 million by June 2024. As for wallets, their use has increased 20-fold in the last four years with major players such as Plin, Bim and Yape.

The latter, operated by the Banco de Crédito del Perú (BCP), had moderate performance upon its creation in 2016. However, its reach skyrocketed starting in 2020, to the point of obtaining 8.8 million users or “yaperos” active per month at the beginning of 2023. That same year, the wallet received a new boost with its arrival in the Bolivian market and interoperability with other wallets, which has allowed it to add one million transactions per day.

“Last year, our active users increased by 20%. We believe that this shows that Yape is part of the daily lives of Peruvians. Currently, we have more than 16 million Yaperos, of which more than 11 million make at least one transaction once a month,” declared Claudia Silva, Yape Business Leader, for AméricaEconomía .

MONETIZATION, THE NEXT STEP

Now, this success seems to be just another stage on the path of digital wallets. New initiatives will be added by existing players to differentiate themselves from traditional banks. Additionally, a new challenge has emerged--the need to monetize. Although everyday payments will continue to be free, platforms plan to include new services to help them achieve their targeted profitability.

This was recognized by Carlos Tori, CEO of Interbank, Plin operator, during his speech at the Peru Digital Payment Forum. “This next step on how to monetize wallets began a few months ago, because it has to be monetized for it to be sustainable,” he said. Among possible alternatives, Tori mentioned services such as payment reminders and personal finance organizers.

For his part, Silva emphasizes the importance of free admission as a characteristic of Yape, but with room for continuous income. "Our monetization today comes from different sources, such as being a collection and recharge channel for companies, and a means of payment at points of sale (POS), as well as different websites and applications."

The wallet's most recent monetized service, “Yape Empresa”, is a exclusive for companies that charge more than 5 UITs (S/ 25,750 or US$ 6,673) per month through Yape. “This service is located within the same application and aims to facilitate the day-to-day management of a company. Therefore, it has a cost, which is a service cost that goes up to 2.95%, but that corresponds to a differentiated value proposition,” explains Silva.

Within this premise, Yape Empresa allows entrepreneurs to affiliate employees as “helpers” so that they can see the payment record of the day's sales, without having direct access to the administration of the account's money. This prevents theft of profits and, in the long run, guarantees the confidentiality of the company at all times.

The Yape representative states that this first version of the service currently allows adding up to five assistants, but does not rule out that this number will grow in the near future. There are more than 2,500 affiliated companies, as well as the possibility of betting on franchises as some of the main clients. On the other hand, the company hopes to increase the membership of “yaperos” in the informal sectors through two key actors: the financial inclusion team and the “sales force”, which is dedicated to affiliate small businesses so that they can collect with Yape.

A NEW MARKETPLACE

It is in provincial and rural sectors where a traditional financial actor seeks to get on the bandwagon of payment digitalization: municipal banks. At the end of April, John Sarmiento, Corporate Services manager of the Peruvian Federation of Municipal Savings and Credit Banks (FEPCMAC), announced that the organization would launch its own electronic wallet. The project would be used by the 10 million clients of the 11 municipal savings banks affiliated with the conglomerate.

In this way, these financial entities, which function as a savings and credit alternative for Peruvians who do not have access to commercial banks, want to take advantage of their national reach to articulate a new proposal.

“The idea was born because in the municipal savings banks we have 10 million active and passive clients throughout the country. We have more than 2,000 agencies, we have a capital structure that covers a large part of rural areas and exceeds that of the Banco de la Nación itself. This situation invited us to think that we could be a good player as a federation in the field of electronic wallets,” Jorge Solís, president of the FEPCMAC, told AméricaEconomía .

From his perspective, Solís believes that having a universe with millions of clients, the majority of which consists of micro businesses and rural populations, is the main strength of the new digital wallet. Likewise, it is taken into account that municipal savings banks already depend on services similar to banking, such as credit and debit cards.

However, it will not be an easy task as digitalization is a challenge for the municipal banks' target audience due to limited Internet access, as well as skepticism towards methods outside the usual transactions. However, Solís believes that they can overcome this impasse , thanks to the feeling of “old acquaintance” that the municipal funds project, to the detriment of other options.

“There is a relationship of trust, of expectation regarding what municipal funds are and I believe that this is going to be the comparative advantage to reach that sector. We are aware that there are Peruvians who still do not have digital experience and logically this can be compensated with promotional campaigns so that they can see electronic science more closely,” says the president of the FEPCMAC.

Gradually, this “digital literacy” would ensure that more users accept the FEPCMAC electronic wallet not only as a “payment gateway”, but as a marketplace of services, such as small microcredits and the possibility of contributing to other accounts. “These lines of credit would not only serve as active working capital, but also for anything else,” explains Solís.

On the other hand, although including monetizable operations in the future is not ruled out, the current priority is the development of new functions for the application. Logically, the most important is interoperability, which allows the systems of the 11 municipal savings banks and, in the future, private banks to be articulated. All this would have to wait until the first quarter of 2025, since the FEPCMAC plans to extend the test phase during the second half of 2024.

In parallel, the BCRP is also aware of the massification of digital wallets and therefore, in April 2024, it announced a project that involves a “digital centralized currency.” This is an initiative that involves digital transactions without the need for an Internet connection. Its experimental phase will begin in July and will have the BCRP as an intermediary and the private sector as a distributor. This way, Peru will join the group of countries that have implemented similar pilot plans, including Brazil, China, Russia, South Korea, India, among others.