Banking institutions like Bancoagrícola, Accion, and Mastercard have joined forces to enhance digital banking services in El Salvador through Nequi.
In this collaboration, Bancoagrícola, Accion, and the Mastercard Center for Inclusive Growth will concentrate on extending a broader range of responsible financial services to low-income individuals within the country.
A key component of their strategy is allowing clients to receive international remittances through Nequi’s digital banking platform.
Details of Bancoagrícola, Accion & Mastercard Partnership
In line with official statements, Accion will collaborate with Bancoagrícola to expand the functionality and scope of Nequi as a tool for everyday financial management. Simultaneously, both parties aim to explore new applications that can boost user engagement and retention in their digital wallets, including recurring expenses such as school fees and local transactions.
The Mastercard Center for Inclusive Growth will support Accion Advisory by utilizing transaction data to develop alternative credit scoring methods for individuals who remain unaccounted for within the formal economic framework. This initiative is particularly significant given that 70% of Salvadorians rely on cash for all their financial needs.
El Salvador’s reliance on remittances as a primary source of income remains substantial, with remittances accounting for approximately 24% of its GDP and over 90% of these funds originating from the United States. The current data shows an increase in US-El Salvador remittances by 16% from January to May 2023.
As most recipients access their remittance funds via cash at Bancoagrícola’s network, many young adults and small business owners, numbering around 440,000 per month, are currently not utilizing the full suite of digital services that could enhance their financial management. This partnership aims to bridge this gap by enabling non-bank customers to participate in Nequi’s ecosystem for receiving remittances. It also facilitates a seamless process where users can manage their finances without frequent cash withdrawals and build credit profiles for future financial opportunities.
