Why fintech startups from Brazil to Sudan use Visa and Mastercard
Often touting a "disruption" of the existing financial infrastructure, fintech startups worldwide are still incredibly reliant on two of the most "traditional" financial actors you can think of.
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Disclaimer: I asked a connection of mine, who works at the Mastercard Foundation, to read over the article to verify the technical parts of it. However, he did not have any influence on the overall opinion I develop in the article.
Why I’m writing this article
Ever since I started writing about the global startup world, fintech has been one of my main areas of interest. Not only is the sector one of the most funded worldwide, but it is also the prerequisite for all other startups to sell any type of digital services/products. I’ve come across a wide range of different fintech startups when writing my articles: crypto startups in Argentina, neobanks in Brazil, fintech unicorn in Egypt… I also recently read a story about Bloom, the first Sudanese startup to join Y-Combinator, which also happens to operate in fintech. In other words: I’ve seen my fair share of fintech startups.
Many if not all of these startups market themselves as ‘disrupting’ the traditional financial status quo. And to some extent, they really do. Paystack is revolutionizing business payments in Africa. Nubank scared the Brazilian banking establishment. Bloom promises to help the Sudanese population protect themselves from local currency inflation.
And that’s exactly why the topic of this article is so interesting to me. How is it that these revolutionary fintech startups, vowing to disrupt the legacy financial establishment, are powered by two of the most “ancient” players in the market, namely Visa and Mastercard?