FINICS

Bringing "Buy Now, Pay Later" for Healthcare to the Mexican market

Company: FINICS operates a Buy Now, Pay Later platform that enables individuals in Mexico to afford healthcare services whenever they are needed.

HQ Location & Year Founded: Mexico City, 2022     

Founder: Nico Maffey, Co-founder and CEO, has had a career spanning the government, academia, non-profit and financial services sectors. Most recently, he was a Public Leadership Fellow at Harvard University and Digital Development Consultant at the World Bank. A native of Argentina, Nico is a graduate of Harvard College and holds an MPA in International Development from the Harvard Kennedy School.

Funds Raised and VC Investors: Under $1 million from Allston Venture Fund and angels

• Where did the idea for FINICS originate?

While working toward my MPA in International Development, I decided that I wanted to start a consumer fintech company in LatAm and Mexico specifically. I knew that the market was dominated by traditional retail banks that charge high interest rates, have restrictive access to banking products, etc. Through my program at the Harvard Kennedy School, I met my initial co-founder Ana Alvarez, who comes from Mexico and shared the same idea. 

We initially set out to create the Credit Karma or Lending Tree for LatAm. We would match borrowers with the best lender available. After pursuing this for some time, we realized that the unit economics of these businesses would take a long time to take off. We got to understand a lot about borrowers in Mexico, however, and we found out that 15% of personal loans were for medical services. Many people cannot afford unexpected medical expenses and most personal loans can take up to two months to get processed by traditional banks and lenders. We decided to go after this market with FINICS and received some initial funding and acceleration from the Allston Venture Fund, Harvard i-Lab, MassChallenge, MIT Sandbox, and angel investors. We also won non-dilutive funding through the MIT Social Enterprise competition.

• What is the key problem that FINICS intends to solve? 

FINICs is built to solve the problem of people in Mexico who cannot afford healthcare services. Less than 10% of people have private health insurance and  almost 70% rely on the public health system. Insurance is expensive and there is a cultural aversion to it. This results in 55% of medical expenses for Mexicans being paid out of pocket. We decided to bring to market a buy now, pay later solution for medical loans, which is novel to this market. This would benefit both the patients and the medical providers. A significant portion of the population are denied medical attention because they cannot afford it and it simply takes too long for someone to get approved for loan when timing is of the essence. Our solution offers competitive loans and fast pre-approval in less than a minute at the point of sale. We have our own credit scoring system that does not exclusively require information from credit bureaus since fewer than half of Mexicans even have a credit score. Instead, we work with medical providers to collect information such as earnings, where people live, the type of intervention needed, and we are able to use this information to provide a decision on the spot. For the provider, our value is in eliminating awkward conversations on financing with patients, suring up revenue and increasing conversion rates.

• How are you most differentiated as a service?

The two main alternatives available in the healthcare space in Mexico  are credit cards and personal loans. What’s different about FINICS is that we can work directly with providers and patients to make decisions. Credit cards in Mexico have less than 25% penetration and loans take a long time and are not compatible with medical needs. Banks don’t have integrations with hospitals and medical providers, but we do. We are able to reduce risk and offer more competitive rates.

• What are the company’s key accomplishments to date?

We started to pilot with a few medical providers. This is going well and we are now partnering with a large hospital in Mexico City. The first big deals are now coming in while we refine the credit scoring model. It’s currently a difficult market context for Buy Now Pay Later, especially in emerging markets, but we are very happy with traction so far and see a significant demand for our solution.      

• What lies ahead in the plans for FINICS?

We are going to embark on further fundraising while we stay lean. Despite the economic recession, medical expenses are not cyclical. As interest rates rise, customers are having a harder time finding financing. We aim to create a frictionless experience to help Mexicans interact with the medical system.

Ron’s Take

This blog series has looked at Buy Now Pay Later companies in different sectors and geographies and they all boil down to enabling those with limited financial resources to obtain services that are needed in a quick and painless manner. Arguably no services are more critical than receiving healthcare. It is an indictment on societies broadly when basic health services cannot be met simply because a patient does not have the means to pay for it. This issue is particularly acute in emerging economies, including Mexico, where FINICS is attempting to disrupt the old way of doing things that ends up failing so many. Ensuri

ng the ability to obtain healthcare at the moment it is needed will save lives and provide comfort for those who do not have sufficient personal savings to cover whatever unexpected events come their way.

Disclaimer: Nico Maffey has served as Venture Fellow with Alumni Ventures since early 2022.