Why it Matters

Mexico's credit card rates hit 50-150% APR—among the world's most predatory. Digitt's $10 million Series A proves there's a profitable business in offering fair credit to Mexico's overlooked middle class, challenging an oligopolistic banking system that has thrived on exploitation.

What's Happening

Mexico City-based Digitt closed a $10 million Series A led by Yolo Investments to expand its credit card refinancing platform:

• The Investors: Yolo Investments (lead), IGNIA Partners, Capria Ventures, plus individual investors

• The Model: Refinance high-interest credit cards with structured loans at significantly lower rates

• The Growth: 10x loan book expansion over three years with single-digit default rates

• The Vision: Becoming "the Amex for LatAm's middle class," per Capria Ventures

The Big Picture

Mexico's banking system is among the world's most profitable—and most concentrated. The top five banks control 80%+ of the market while charging rates that would be illegal in most developed countries. This oligopoly has created massive opportunity for tech-driven challengers serving creditworthy but overcharged consumers.

Digitt's approach sidesteps the crowded subprime market to focus on middle-class borrowers who qualify for better rates but can't access them through traditional channels.

How They Win

Digitt's competitive advantages stem from superior technology and streamlined operations:

• Smart Underwriting: AI-powered analysis of bank statements and bureau data for faster, more accurate credit decisions

• Lower Costs: Social media customer acquisition and automated workflows keep overhead minimal

• Focused Market: Creditworthy middle class vs. high-risk subprime borrowers

• Proven Unit Economics: Profitable lending without predatory pricing

The Market Reality

Mexico's financial exclusion runs deep despite strong economic fundamentals:

• 50-150% APR: Standard credit card rates that trap borrowers in debt cycles

• 80% Market Concentration: Five banks control access to fair credit

• Massive Middle Class: Underserved population with stable incomes but limited options

• Tech Adoption: Growing smartphone penetration enabling fintech solutions

What's Next

The Series A will fund geographic expansion and product development. Success at scale could pressure traditional banks to lower rates or risk losing their most profitable customers to tech-enabled competitors.

Digitt's model also provides a blueprint for other LatAm markets with similar banking oligopolies and predatory lending practices.

The Bottom Line

Digitt proves that fair lending can be profitable lending. By using technology to serve Mexico's creditworthy but overcharged middle class, the company is building a sustainable business while challenging a banking system that has thrived on financial exclusion. That's impact investing at its best—profit and purpose aligned.

Go Deeper

• Digitt raises $10 million Series A announcement - Full ImpactAlpha coverage by Erik Stein

• IGNIA Partners impact thesis - Mexico-focused impact investing approach

• Capria Ventures emerging markets strategy - Tech-driven solutions for underserved consumers