YellowPepper’s Mobile Wallet For LatAm Draws Another $19M From LIV Capital And Others

YellowPepper, a mobile virtual wallet startup aimed at the Latin American market, has closed $19 million in a Series C funding round, bringing its total funding to $34 million to date. The round was led by LIV Capital, a Mexican venture capital firm with approximately $130 million in assets under management. Also participating was Mexico Ventures, a program managed by Sun Mountain Capital (a US-based venture fund), Fondo de Fondos, International Finance Corporation / World Bank Group and an existing group of strategic investors.

Last month the company launched Yepex, which is being pitched as Latin America’s ‘mobile smart wallet’. The proceeds of this round will mainly be dedicated to its development and commercialization. Banamex, the 2nd largest bank in Mexico, was the first bank to try the Yepex app in a controlled pilot and will now launch a beta with users and merchants in Mexico.

The Yepex wallet is an Android and iOS-based wallet where the users can store all their different debit and credit cards and start purchasing without giving away sensitive information (such as PAN, expiration date, CVV), but can instead transact with a unique token that can either be communicated to the merchant manually or via HCE or QR codes. By using this token system, neither merchants or nor customers need NFC-capable phones before they can do mobile payments. As you can imagine, this makes the technology far more widely available, even to users without the latest smartphones.

Serge Elkiner, CEO/Co-Founder, says the tokenization system “drastically reduces” the fraud for card-not-present transactions, which is a major predicament in Latin America. He says it also improves the security for ATM transactions through a card and pin-less withdrawal. It can also be used in retail situations like pre-ordering items and express checkout. Thus, far less queuing. So far the company claims over five million customers, over 30 million transactions per month and an 85% market share in Latam.

PayPal is considered to be Yepex’s biggest competitor, although there are several Latin American companies focusing on mobile payments. Local competitors are companies such Pademovil (Mexico) and Mobilcard (Mexico and Colombia), which are primarily offering ‘closed loop’ mobile payment solutions or services for the ‘unbanked’. Instead, Yepex works on the existing card infrastructure and targets only those with credit or debit cards, in other words, those that hold roughly 90% of the total purchasing power.

Not getting into NFC is probably a wise move in emerging markets and could ensure that Yepex, which already has an early advantage, could spread further.

from TechCrunch http://feedproxy.google.com/~r/Techcrunch/~3/uPbkKiLBDho/

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