The startup issues its cards to “underbanked” Mexicans like 33-year-old Nadir Redon Texta, who makes a living reselling stainless steel clothing and accessories in the town of Zihuatanejo and has been unable to secure a line of credit in no bank.
“I earn between 4,000 and 8,000 pesos a month because my activity is informal and seasonal,” he said in a telephone interview. “I started with a monthly credit of 1,500 Mexican pesos ($75.18) at Stori and have always been able to pay it.”
Only 31% of Mexicans have some type of credit, and those who do tend to use department store or convenience store cards, according to the country’s statistics agency.
Stori grants a line of credit to 99% of applicants after a background check that looks at a combination of factors such as where they live and how they make a living, said Marlene Garayzar, the co-founder of the 2018-launched company. .
“Some applicants do not have the official documents that we require. Otherwise, our acceptance percentage could reach 100%. We give credits as small as 500 pesos and in our experience people pay,” said she said.
Garayzar said Stori, which is backed by investors including US-based GGV Capital and Goodwater Capital, plans to expand into at least one more Latin American country over the next two years, but declined to say what. markets she envisions.
Mexicans with informal employment or poor credit history tend to knock many doors before they can get a loan. This is the case of Eduardo Alvarado, 28, whose card application was rejected by the Brazilian fintech Nubank.
“Nu asked me to try again later, so I went to Stori and they accepted me. Months later, I tried again with Nu, and they approved. I guess it was very influential to have Stori as seed credit,” he said.
Stori has a million customers and most of them are first-time credit card holders, while Nubank has about 1.4 million customers in Mexico and 60% of them had another credit card. card before contracting its services.
($1 = 19.9515 Mexican pesos)