Disparate payment and clearing systems across Latin America present challenges for corporate treasurers. But the race is on to build new market infrastructures that support the transition to faster payments.

Author: Denise Bedell

Countries in Latin America faced massive economic and political upheavals last year. In Brazil, the impeachment of president Dilma Rousseff sparked riots and months of protests, emblematic of a crisis of confidence in the country’s political leaders and systems.

In contrast, Argentina—a country that has struggled since its debt default in 2001, and subsequent “selective” default in 2014, to change its image among foreign investors—is now presenting a more business-friendly and reformist face under president Mauricio Macri, who assumed office at the end of 2015. The other major economy in the region, Mexico, saw growth start to slow toward the second half of last year.

This year, the big question for multinational corporations that do business in the region—particularly in Mexico—is whether US president Donald Trump will enact changes to trade policies, and what this means for those companies that derive the bulk of their revenues from trade with the United States.

According to Carmela Gómez Castelao, head of international transaction services at BBVA, security and risk management are key concerns for companies based in Latin America. “Companies are looking at employing successful tools to protect themselves,” she explains. “These tools go beyond the deployment of IT—but also [include] analyzing risk at all levels by training employees and validating suppliers.” Castelao says that ensuring security of communication channels is critical.

She also highlights the drive to digitize, citing corporate executives’ desire for an enhanced digital experience, with simpler interfaces and fewer processes. “Customer experience is on everyone’s mind; [and] investment in innovation [means] channels, online customer services, products and DIY [do-it-yourself] capabilities that allow an ‘anywhere-everywhere’ service.”

Data is king, adds Castelao, in helping customers with their day-to-day supply chain and liquidity management. In a region that is made up of many countries, each with its own systems and utilities for payments, clearing and settlement, companies are keenly aware of the challenges of managing cash and liquidity.

Castelao says cash flow forecasting and efficient cross-border account structures are critical for both clients and banks, as is “designing a standardized payment process for all payment types in the region.”

Going into 2017, she says the matter of faster payments is topical, with initiatives already underway to improve the speed and efficiency of payment systems in different countries in the region. “[It] is making financial institutions invest in digital technology solutions—as we’ve seen with the explosion in blockchain initiatives—through collaboration with fintechs,” explains Castelao. 

Latin America

Best Overall Bank for Cash Management


Best Bank for Liquidity Management


Best Provider of Short-Term Investments/Money Market Funds

Santander Global
Transaction Banking & Corporate Investment Banking

Best Bank for Payments and Collections


Best Bank for Working Capital Optimization




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