Miami-based startup YellowPepper has raised $19 million Series C funding to develop its mobile smart wallet aimed at the Latin American market.
The company launched Android and iOS-based wallet Yepex last month. Users can upload debit and credit cards to the wallet, which uses tokenisation to obscure sensitive card data when making transactions. The code can either be communicated to the merchant manually or via HCE or QR codes, meaning that neither merchant nor customer needs NFC-enabled equipment.
Card-not-present fraud is a major problem in Latin America, the company says, one which Yepex’s tokenisation system can reduce. It also improves the security for ATM transactions through a card and pin-less withdrawal, and can also be used in retail situations like pre-ordering items and express checkout.
The proceeds of this latest round will be dedicated to its development and commercialisation, TechCrunch reported.
Yepex has had a successful pilot run which Banamex, the 2nd largest bank in Mexico, which is now launching a beta with users and merchants in Mexico. So far, Yepex has over five million customers and deals with over 30 million transactions a month, the company says, with an 85 per cent market share in Latin America.
Yepex’s local competition Pademovil in Mexico and Mobilcard in Mexico and Colombia primarily offer closed loop mobile payment solutions or services for the unbanked, while Yepex works on the existing card infrastructure, only targeting those with credit or debit cards. The company’s current biggest competitor is PayPal.
The Series C funding round was led by Mexican VC firm LIV Capital, with participation from Mexico Ventures, a program managed by US-based venture fund Sun Mountain Capital, Fondo de Fondos, International Finance Corporation / World Bank Group as well as existing investors.
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