Citigroup’s planned withdrawal from its Mexican consumer and small and medium-sized enterprise banking business has highlighted the tough operating environment in the country as its economy wrestles with the lingering effects of the coronavirus pandemic.
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Chief executive Jane Fraser says that the bank wants to focus on wealthy consumers and large corporates in Mexico, and so is withdrawing from a country that she told Euromoney in 2018 that the bank would never quit “because the scale is so significant and, for Citi, it is our second-largest market after the US”.
What has changed? Five years is a long time in consumer banking and Citi is exiting Mexico at a time when the country’s mass consumer market is increasingly targeted by the country’s burgeoning fintech sector – which has more than tripled in size since 2016, with over 500 fintechs now active, according to Finnovista, a venture development and research firm.
One of those companies is Clara – the fastest fintech to reach unicorn status in Latin America.