Venezuelan fintech startups find opportunity amid hyperinflation

Global Business

As hyperinflation brings sky-high prices to Venezuela, its currency–the bolivar–has become almost worthless. Venezuelans stand in line for hours outside banks and ATMS to withdraw cash. Those withdrawals are often limited to just 20 bolivars per day, which is not enough money to buy even one piece of hard candy.

People in Venezuela are learning to rely less and less on cash and more and more on electronic payments.

CGTN’s Juan Carlos Lamos reports.

Four years ago, four enterprising friends developed a digital and mobile platform to help solve the problem. Called PagoFlash, it offers several payment methods and targets small to medium-sized enterprises who need help updating their technology.

PagoFlash Founder and CEO Danhalit Zamalloa explains, “We are a payment method. We work online and our focus is to create simple solutions for people to pay through websites, email, social networks and even WhatsApp.”

One early adopter of PagoFlash is Erika Glenn, founder and owner of a the cupcake company Sponcakes. When she first started using PagoFlash, Glenn had not yet developed a Sponcakes website.

Glenn says PagoFlash allowed her customers to pay through their social networks and WhatsApp. “Cash is no longer a priority. Prices go up daily and cash payments cannot cope with it. That’s why I decided to use PagoFlash two years ago. It’s easier for my clients to pay through the PagoFlash app.”

PagoFlash user Reinaldo Mozo says he’s grateful to be able to do his shopping from the comfort of his sofa. “I hope more companies in Venezuela start to use electronic payment methods. It’s clear the government won’t solve the cash crisis, which is out of control. The internet is unexplored territory in Venezuela and it can make our payments way easier.”

PagoFlash is one of several electronic payment systems operating in Venezuela right now. With more than 600 merchants and thousands of customers using it, PagoFlash is making plans to expand to Peru later this year. For this company, an economy in crisis has provided opportunity.

PagoFlash CEO Danhalit Zamalloa discusses Venezuela’s fintech trend

CGTN’s Juan Carlos Lamas discusses electronic payment systems with PagoFlash CEO Danhalit Zamalloa.