Financial Innovation in Latin America and the Caribbean: a Tale of Pragmatism and Progress

In financial innovation, Latin America and the Caribbean punch above their weight. Digital innovations have helped to reduce costs and enhance access to financial services. Pragmatic policies, such as public infrastructures and regulation, have helped to address economic distortions that can arise in markets. This article gives insights into both the theory and practice of financial innovation in the region. Drawing on examples like Brazil's Pix, Costa Rica's SINPE Móvil, central bank digital currencies in the Caribbean and digital wallets, lending, insurance and big tech services in other countries, it shows that innovation is proceeding rapidly. These experiences are ripe for further research to inform policy.