Great idea. I see the same problem in Dominican Republic where interest rates are crazy high and people don’t have credit card.
Love the name by the way. Como vas a pagar? A trato :)
Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
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Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#32Pretty cool - but why is it that so many people in LATAM don't have credit cards? Does the existence of neobanks (I'm thinking Revolut, N26, etc.) change much in your thinking about the market?
Lack of financial literacy and no acquisitive power + informal economy. Banks in Latam invest a lot in Credit Card penetration but they only can offer credit to people who are already embeded into the financial system through formalized payroll.
Many people in Latam aren't part of a payroll and make their living from the informal economy. Even if those people have the acquisitive power, Banks will never extend them a credit line because they don't have anything to demonstate a steady income besides their word.
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#33When you say LATAM, which countries are currently supported? This sounds awfully familiar to how credit cards work in Brazil, where merchants can let you divide payments in an arbitrary number of monthly installments. For example Amazon let's you divide up to 10 times, some brick and mortar stores let you parcel up even longer.
We are currently only supporting Mexico. As you mentioned in Brazil credit cards are really strong, but here in Mexico Credit Cards penetration is really low so there is a huge amount of people that are unable to divide their payment into monthly installments. Thats were Atrato comes in! We allow our customers to divide the payment without the need of a credit card
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Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#34When you say LATAM, which countries are currently supported? This sounds awfully familiar to how credit cards work in Brazil, where merchants can let you divide payments in an arbitrary number of monthly installments. For example Amazon let's you divide up to 10 times, some brick and mortar stores let you parcel up even longer.
We are currently only supporting Mexico. As you mentioned in Brazil credit cards are really strong, but here in Mexico Credit Cards penetration is really low so there is a huge amount of people that are unable to divide their payment into monthly installments. Thats were Atrato comes in! We allow our customers to divide the payment without the need of a credit card
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Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#35I like the name! A great idea since affiliation will happen at the moment of purchase. Can it work for online stores/services? How do you manage the legality of the operation, for example, down here in Ecuador you need to be an accredited financial institution in order to write loans or receive payments.
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#36When you say LATAM, which countries are currently supported? This sounds awfully familiar to how credit cards work in Brazil, where merchants can let you divide payments in an arbitrary number of monthly installments. For example Amazon let's you divide up to 10 times, some brick and mortar stores let you parcel up even longer.
We're currently in Mexico! And yeah, here you can do that as well. The problem is that not a lot of people have a credit card (90.5% to be exact) and even if they have, they have enough credit limit and deal with the opacity, late fees, and complexity of credit cards. Also, this is defered interest, not actual installments, that means that wen you miss a payment you get charged the interest rate of your card (60% APR…
Thanks for the reply! It seems the credit card system in Mexico is way more complicated than what I have experience with. Kudos to you guys for trying to disrupt the system!
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#37Is the name related to atrasar , to postpone? Not a criticism at all, because no doubt you are offering choices to people that currently don’t exist, but isn’t 40% APR still insane? Sounds like you do some kind of quick, automated credit scoring. How does that work in Mexico and countries south? Do the big three scourges of the US reach into CA and SA?
I don't think the name is related to that. There's a river at the west of Colombia called Atrato.
Yeah. Atrasar is a bad word. It's like saying "be late". Our name comes from the Atrato River, which is a river that connects central america with south america and provides a safe way for travelers while passing through the rough and dangerous terrain of the Darien Gap.
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#38This is not for Latin America. This is for Mexico only.
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#39Pretty cool - but why is it that so many people in LATAM don't have credit cards? Does the existence of neobanks (I'm thinking Revolut, N26, etc.) change much in your thinking about the market?
Lack of financial literacy and no acquisitive power + informal economy. Banks in Latam invest a lot in Credit Card penetration but they only can offer credit to people who are already embeded into the financial system through formalized payroll. Many people in Latam aren't part of a payroll and make their living from the informal economy. Even if those people have the acquisitive power, Banks will never extend them a…
Got it, that's interesting - also interesting to see Rappi, which definitely does have more data (for its users at least) on spending habits and earning, even in the informal economy launching a card. I wonder if there'll be more of that for companies like Uber/Taxify that specialize in informal labor but serve as a jobs market issuing their own local credit lines in partnership with financial institutions
Re: Launch HN: Atrato (YC W21) – Credit Card Alternative for Latin America
#40Wow! Great job guys! I've often wondered how this could be solved in Mexico and you guys seem to have found a nice way to do it.
I'm curious, but would someone who has a small shop at the mercado be able to use your service? Would this let them compete against Coppel if a consumer want to buy cheaper electronics from the guy across the street? Are these the people you're targeting at all? Your aleados look very established.