The classification of Buy Now, Pay Later (BNPL) in Latin America is undergoing a structural evolution, moving from an alternative financing niche to a core component of payment infrastructure. According to Andrew Seiz, senior vice president of strategic finance at Kueski, this shift is driven by the unique requirements of the Mexican market, where a significant portion of the population remains excluded from traditional banking systems.

In Mexico, 52% of the population is unbanked and 67% lack access to a credit card. This lack of financial penetration, combined with the fact that 79% of transactions are still conducted in cash, creates a landscape where payment innovation must precede, rather than follow, financial inclusion. Seiz explained that in this context, BNPL does not necessarily compete with established credit products but instead displaces cash and formalises consumption.

Building Parallel Rails

The “BNPL playbook” in emerging markets like Mexico differs fundamentally from developed economies like the US or Europe. While BNPL in mature markets focuses on optimising checkout flexibility for consumers with established credit histories, the Mexican reality involves “thin-file” consumers who represent a systemic feature of the market rather than a marginal segment.

Kueski addresses this by shifting core competency from traditional credit scoring to risk architecture. The company leverages artificial intelligence and proprietary machine learning models to evaluate hundreds of behavioral and transactional variables in seconds. Seiz noted that this allows the platform to construct predictive models tailored to a high-informality economy, effectively building parallel rails that expand formal participation.

To date, the platform has issued approximately 40 million loans across Mexico. This scale provides a deep dataset that allows for continuous model iteration and the identification of repayment patterns often invisible to legacy scoring systems.

Institutional Appetite and Resilience

As global interest rates remain a factor, the sustainability of the BNPL model depends on unit economics and risk segmentation. Seiz commented that all purchases through Kueski Pay include interest-free biweekly installments, supported by disciplined capital allocation and strong repeat usage.

The resilience of the sector is also attracting a more nuanced view from the investment community. Institutional capital is increasingly recognising that short-duration, data-driven consumer credit in underpenetrated markets offers a way to de-risk exposure compared to long-dated sovereign or corporate risk.

“Capital markets are increasingly recognising that short-duration, data-driven consumer credit in these environments offers differentiated exposure,” Seiz added, noting that granular portfolios allow for dynamic repricing and rapid recalibration across economic cycles.

Future Outlook

Looking ahead, the focus remains on deepening the credit and payment layer rather than an immediate pivot into “super app” territory. While Kueski has seen its app reach close to 1 million downloads per month, the priority for the next 18 months is execution and enhancing security to continue earning trust at scale.

Seiz concluded that by strengthening the core infrastructure, the company is building a financial ecosystem that can evolve responsibly while maintaining capital discipline.