DLocal is one of the most famous payment players in Latin America. He specializes in cross-border payments for emerging markets such as Brazil, Mexico, Colombia and his home country of Uruguay.
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LONDON – Uruguayan payments company dLocal has been awarded a UK payment institution licence, adding to a growing portfolio of regulatory approvals as it pursues global expansion.
The emerging markets-focused fintech company told CNBC it has received an authorized payment institution license from the Financial Conduct Authority, the UK’s financial services regulator. This will allow him to begin to attract British traders for the first time.
DLocal will attract UK traders through local company Larstal Limited. The subsidiary, which trades in the UK as dLocal Opco UK, was previously unable to attract customers locally due to restrictions imposed on it by the FCA. DLocal said the restrictions were a result of the UK leaving the EU.
Pedro Arnt, CEO of dLocal, told CNBC that he expects the business to stand out among domestic payment technology competitors such as Worldpay and Checkout.com, given its focus on emerging markets in countries such as Latin America, Africa and Asia.
“When we think about our UK merchant base, the differentiating factor for us is that we only operate in the regions where we serve them,” Arnt said in an interview. He added that dLocal is also targeting global merchants with a presence in the UK.
“The UK has become a hub for many global companies – even US companies and some Asian companies – for their expansion into emerging markets, primarily in Africa and in some cases in Latin America,” Arnt told CNBC.
UK expansion plans
Founded in 2016, dLocal is one of the most prominent payment players in Latin America. He specializes in cross-border payments for emerging markets such as Brazil, Mexico, Colombia and his home country of Uruguay.
With a payments license under its belt, dLocal is looking to expand its presence in the UK with plans to increase headcount and grow the business.
Arnt said dLocal was already expanding its presence in the UK, with a number of its senior executives, such as chief operating officer Carlos Menendez and chief revenue officer John O’Brien, based in London. dLocal currently employs more than 1,000 people worldwide.
The main benefit that dLocal’s UK payments license will bring is its recognition as a “licensed partner” that businesses in the developed world can trust to process payments in emerging markets with complex regulatory needs, Arnt said. DLocal currently has over 30 licenses and registrations worldwide.
However, dLocal will face stiff competition. Britain already has an established fintech ecosystem with numerous well-capitalized players operating in the payments world, including PayPalstripe, AdienCheckout.com, Mollie and Revolut to name a few.
“Not for sale”
DLocal went public on Nasdaq in 2021 with a $9 billion valuation at the time. Since then, its market capitalization has declined. As of Tuesday, the business was worth $3.4 billion. However, the stock is up about 40% over the past six months.
Last month Reuters reports this. dLocal was considering a possible sale. When asked by CNBC about the buyout speculation, Arnt said he didn’t want to comment on the rumors, but clarified that dLocal is not currently for sale.
Overall, Arnt said, the company’s publicity implies a level of transparency and control that he considers “positive from a business perspective” for it. From time to time, he added, “there are rumors that someone is interested in this asset, but I would not assume that there is anything special about it.”
“While shareholders will have a fiduciary duty to allow takeovers, Arnt said the “company is not for sale at this time.”