B2B payments in Latin American countries face numerous challenges, such as an inadequate infrastructure, lengthy payment processes, and high foreign exchange rates. A startup named Higo has been founded to address these challenges and revolutionize the payment process. Homebrew, a venture capital firm, has backed this effort to make Higo the ‘Venmo for B2B payments’ in Latin America.
This introduction will offer insight into the challenges of B2B payments and discuss how Higo is striving to tackle them.
Homebrew backs Higo’s effort to become the ‘Venmo for B2B payments’ in LatAm
B2B payments have become integral to the Latin American corporate landscape. Companies operating in the region rely heavily on B2B payments to continue doing business and managing their cash flow. Although B2B payments are vital to businesses, some challenges are faced daily by companies that process these types of payments in Latin America.
Firstly, manual reconciliation processes make it difficult to track payments and identify discrepancies quickly, leading to extra time spent dealing with operational issues which could easily be avoided. Additionally, LatAm has a suboptimal network for physical financial infrastructure which can also lead to delays in processing payments because banks take much longer than ideal to confirm transactions. Lastly, most payment processing solutions in the market lack transparency or contextual data related to the recipient such as buyer lists or country-specific taxes applied that must be accounted for as part of settlement finalization.
Higo is a fintech company focused on digitalizing and automating B2B payments across multiple industries and markets globally. In Latino America (LatAm), our goal is to overcome the negative features tying into traditional payment methods by introducing a secure platform for businesses transferring funds across multiple countries within LatAm margins restricted settings indicative of the region’s framework – without any additional charges or long wait times associated with legacy payment methods. In addition, Higo’s platform provides an integrated solution with tools such as early fraud detection capabilities and end-to-end visibility throughout each stage of every transaction. Hence, you know where your money is every step of the way.
Homebrew backs Higo’s effort to become the ‘Venmo for B2B payments’ in LatAm
Homebrew, a well-known venture capital firm, backed Higo’s effort to become the ‘Venmo for B2B payments’ in Latin America. This news comes shortly after Plug and Play selected Higo as one of the top 10 startups from its Global Fintech Accelerator program, demonstrating strong validation for the company and their platform.
Higo strives to alleviate B2B payment challenges in LatAm with their “business-friendly payments solution” that is quick and easy to use. The current market poses many difficulties for businesses, such as lacking traceability of operations and payment options. All these problems can be solved with a simple platform by Higo that automates routine operations, increases efficiency, reduces manual labor costs and speeds up cash conversion — an all-in-one comprehensive payment solution.
Homebrew’s support allows Higo to further strengthen its presence in the region while developing key partnerships with major financial institutions, helping them create a faster and more secure digital payments infrastructure across Latin America. As Brian Watson (CEO at Homebrew) noted: “Higo is creating a much needed bridge between traditional banking infrastructure and fintech solutions which enables businesses in LatAm to grow”.
Challenges of B2B payments in LatAm
Business-to-business payments in Latin America are complicated and costly. For example, cross-border payments typically require paperwork, physical bank visits, long waiting periods, and high payment processing fees.
To address these issues, Homebrew has recently backed a financial technology startup, Higo, which aims to become the ‘Venmo for B2B payments’ in Latin America.
We will explore the challenges of B2B payments in the region and how Higo is leveraging technology to make them faster and easier.
Lack of trust and transparency
Trust and transparency are the two main challenges Latin American businesses often face when completing B2B payments. Many companies in the region have difficulty verifying the legitimacy of counterparties, particularly if they are international, which stifles trust between parties and can impede the process of finalizing a deal. Even in domestic transactions, companies increasingly seek more secure and reliable payment solutions that provide guarantees against fraud.
In addition, many transactions come with complex conditions involving several players, making it difficult to ensure that all necessary documents are provided and to keep track of who has access to confidential data or payment details. This adds a layer of opacity and mistrust, thus hindering transaction completion times.
Higo is helping address this challenge by introducing an innovative platform for trust and transparency in B2B payments across Latin America. Our integrated platform facilitates end-to-end validation of any kind of transaction through a secure blockchain ledger system, creating immutability between all parties involved in a contract. In addition, integration with electronic signature tools ensures documentation follows industry standards for secure document delivery. All this fosters an environment where everyone is comfortable to transact freely without worrying about potential risks or conflicts arising from working with untrustworthy counterparties.
Lack of access to financial services
For businesses in Latin America, accessing financial services is a major obstacle. Because of the lack of infrastructure and customer reach, it can be difficult for businesses to find payment systems tailored to their needs. This problem is further exacerbated by financial institutions often charging high fees and having long wait times when processing payments.
This lack of access makes it difficult for many businesses to conduct transactions between each other, especially when one or both parties do not have access to credit cards or banking services. To address this challenge, Higo has developed cutting-edge technology that allows businesses to quickly secure B2B payments within LatAm countries by leveraging existing banks’ networks.
Higo’s mobile banking platform enables businesses to easily send money across borders, while also providing payments insights and data analytics capabilities so businesses can make better decisions about their finances and transactions. Higo’s intuitive platform provides users with an all-in-one solution for easy cross-border payments between individuals and organizations. It makes it easier for all parties involved to transact quickly and securely without worrying about banking system access or credit card availability issues.
High transaction costs
The high cost of B2B payments in Latin America can be attributed to inefficient, outdated payments systems and processes. Transactions with traditional financial institutions, such as banks and clearing houses, are subject to high fees, long wait times and other bureaucratic hurdles. In addition, differences in local payment methods can further increase these transaction costs.
To address this issue, Higo has developed a modern infrastructure for payment processing that integrates the various regional payment systems into one entity. This ensures businesses pay lower fees due to removing intermediaries from their payments process. In addition, it simplifies their ability to send cross-border payments by providing business customers access to a larger network of payment partners.
Having an up-to-date platform for access to a broad range of local and international payment methods, Higo makes it easier for businesses to make secure transactions without being exposed to excessive transaction costs or delays.
How Higo is addressing the challenges
The challenges of B2B payments in Latin America are often overlooked, with many companies struggling to facilitate payment solutions that make financial transactions easy.
Higo, backed by Homebrew, is an innovative platform that seeks to provide a comprehensive B2B payment system in the region.
This article will examine how Higo addresses the current challenges of B2B payments in Latin America.
Leveraging blockchain technology
As B2B payments continue challenging businesses in Latin America, many companies turn to blockchain technology to help solve their payment woes. Higo, a leading B2B payments platform, is one such company leveraging this innovative system.
Higo’s platform allows users to send and receive payments quickly, securely and with low fees across borders at the fraction of a cost. This unique system bridges the gap between buyers and sellers of goods and services in Latin America by providing an efficient platform that mitigates the complexity of traditional payment systems.
Using blockchain technology, Higo offers features such as instant settlement that results in real-time delivery of funds, allowing recipients to access funds almost immediately after a transaction has been approved. In addition, the transparency within the transaction process is increased due to the immutable nature of blockchain, ensuring all documents related to a contract are securely stored on the distributed ledger without any data manipulation or corruption. Moreover, all sensitive customer information is safeguarded and encrypted using SSL security protocols for maximum security throughout every transaction across its platform.
In summary, Higo leverages blockchain technology to create an efficient B2B payment street for Latin American businesses. Its robust yet user-friendly payment processing solution enables quick settlements and ensures maximum security along every transaction step. With these benefits making up an integral part of its framework, Higo provides users with significantly more secure and reliable payments networks than traditional banking infrastructure and greater transparency over their transactions and data records.
Leveraging AI and machine learning
Higo leverages the power of AI and machine learning to minimize the risk associated with B2B payments. AI and machine learning have enabled data-driven insights which offer great potential in understanding customer profiles, enabling risk scoring and ultimately helping prevent fraud. Thanks to AI, Higo can easily integrate into existing ERP systems to provide a single access point for customer information to provide insights into customer purchasing behaviour. This enhances their payment security capabilities by providing insight into their customer’s propensity for fraud or their level of creditworthiness.
Higo’s security-driven platform stands out from traditional players by offering a unique 1-click checkout experience, allowing customers to complete transactions quickly and securely within seconds, without having to enter personal information manually each time they make a purchase, which helps reduce the chances of being hacked or falling victim to a phishing scam. Thanks to its real-time fraud detection, Higo also takes extra measures against cyber threats by introducing additional layers of authentication such as biometric scans and other identity verification procedures during checkout.
Building a secure and transparent platform
As customers across LatAm become more selective about how their payments are made and delivered, money transfer companies must invest heavily in creating a secure and transparent payment platform. At Higo, we understand these are the foundational building blocks for any successful global money transfer service, so we’ve taken the initiative to build a system built around secure transactions.
We take special measures to ensure that users can always trust us and that 95% of our transactions are digitally related — such as account logins, token creation/verification, data encryption, etc. Our system is also built on secure SSL technology provided by leading technologies such as Verisign and Digicert, allowing users to confidently make all payments. Additionally, our two-step authentication process protects all accounts’ security, ensuring everyone is protected from any unauthorized activity on their account.
To ensure transparency at every step of the transaction process — from sending to receiving — all payments are tracked using blockchain technology and kept safely encrypted until they reach their final destination.
By investing in building a system focused on security and transparency, we have created a safe environment for all parties involved – allowing customer confidence in transacting with us and providing a robust long-term platform for continued growth.
Conclusion
In conclusion, the Latino American B2B payments market presents distinct challenges, but it also contains great growth potential. With Homebrew’s investment in Higo, the company is well-equipped to become the “Venmo for B2B payments” in LatAm.
With its innovative features, such as accepting payments in multiple currencies, zero cross-border fees and automated reconciliation, Higo is well-positioned to revolutionize the Latin American B2B payments market.
Summary of the challenges of B2B payments in LatAm
Business-to-business payments in Latin America have traditionally been predominantly cash-based, inefficient and lack transparency. These challenges result in payment delays, transaction costs, administrative headaches and even fraud potential.
The traditional banking system is often inadequately equipped to deal with the demands of modern businesses operating in a globalised economy. As a result, many companies struggle to access adequate services which limit their ability to pay efficiently within Latin America or abroad due to lack of existing payment rails for local B2B payments. Furthermore, the current regulatory framework does not make it easy for companies looking to issue cross border payments within LatAm countries that are not part of the same currency block.
In addition, using checks or cash can delay the settlement process by several days and introduce further risks such as fraud or unanticipated service fees when transferring funds internationally. Money transfer companies offer an alternative but again this can introduce hidden fees and is not always designed with business use cases in mind, making it hard to scale operations across borders without encountering delays or substantial disruption.
Summary of how Higo is addressing the challenges
Higo is taking a comprehensive approach to addressing the challenges of B2B payments in Latin America. The company provides an end-to-end solution that includes bank agnostic payment initiation, multi-currency support, integrated supplier onboarding and data validation, fraud protection measures, open APIs for integration with existing enterprise resource planning (ERP) systems and access to real-time data on payment status.
Higo is also streamlining the customer experience through advanced customer service and intuitive user interfaces, making it easy for customers to initiate payments via web or mobile channels. This allows them easily manage their suppliers and set up automated recurring payments for frequently purchased items like raw materials or payroll. For financial institutions, Higo provides automated internal reconciliation using machine learning algorithms to reduce manual reconciliation efforts.
In addition, Higo’s integrated tools make it easy for customers to monitor their compliance with regional regulations while offering support services such as issuer identification numbers (IINs) and customer notifications via SMS and email whenever changes are made to the payments landscape. Finally, with its extensive network of local payment transactions processors throughout Latin America, Higo can provide fast settlement times in the local currency of their customers’ choosing.
