Paper Example on Mexican Economy

Introduction

This paper serves to purpose as an examination into the Mexican economy, particularly focusing on the Mexican Banking sector and the application of financial technologies within the industry in itself. The aim is to establish if the market is potentially attractive for a technological company investment as such. To this end, the discussion presented herein entails the screening of the country's banking sector and the assessment of the industry market potential and competitiveness over the dimension of technological applications and automation per se and consequently identifying the attractive markets.

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The driving factor behind the international market opportunity analysis and assessment that has been presented herein is to determine the potential attractiveness of a Robotic Process Automation (RPA) service entry into the Mexican banking industry. As such, a technological company, Virtusa (virtusa.com) is seeking to expand their business operations by an entry into the Mexican economy, offering the above RPA services to the Mexican banking and financial services sector (Castellanos et al., 2016).

Virtusa is an organization that has strongly positioned itself as one of the leading information technology firms that various business solutions to their clients with the aim of accelerating their business outcomes. The company currently supports various entities, including numerous Forbes Global 200 firms in which they give expert digital IT business solutions through their consultation and outsourcing assistance. The main objective of Virtusa is to offer industry-leading IT solutions that ensure the transformation of business not only for an enhanced today, but also a better future as well.

Currently, the Mexican banking and financial sectors are characterized by numerous commercial banks, development banks, various foreign exchange companies and several fintech startups. The Mexican commercial banks offer a wide range of services from the operation of deposit accounts, lending services (commercial and individual consumer), corporate finance, mutual funds foreign exchange to mutual and trust funds and financial market trading. The development banks on the other hand offer services meant for funding any financial shortfalls, especially within the banking industry in itself. The fintech startups' main focus is on the payments, lending, crowdfunding, remittances and other individual financial management services (Louca and Ash, 2018).

Latest statistics reveal that there's a total of about 48 commercial retail banks in the Mexican market, sevegovernment-owneded development banks and numerous fintech startups. As a matter of fact, Mexico offers the third largest market for these financial technology startups in Latin America, after Columbia and Brazil. Accordingly, Virtusa is positioned to gain from an entry into the Mexican banking industry due to the presence of numerous banks and other financial companies, that are greatly embracing technology through the development and implementation of various information technology business solutions. Such organizations and entities are positioned to greatly benefit from these solutions, specifically, the Robotic Process Automation services, the underlying factor for this discussion.

Robotic process automation (or RPA) is an emerging form of business process automation technology based on the notion of software robots or artificial intelligence (AI) workers. RPA has provided digital speed to market ancost foror which the financial institutions of tomorrow will succeed after embracing the next new wave of robotics technology and futuristic technology to pilot business outcomes. Robotic Process Automation is basically automating business processes by managing them, tracking them, and having them executed by robots in all the departments of an organization. By switching to Robotic Process Automation, financial institutions can break many of their barriers by achieving operational flexibility, efficiency and enhanced performance at an enterprise level (Willcocks and Lacity, 2016).

Automation in the banking sector basically entails the system of operating the banking process using spontaneous means so as to minimize human intervention (Ustundag and Cevikcan, 2018). Millions of Mexicans who live in rural areas can hardly get access to basic financial services, according to a report by the National Banking and Securities Commission. Robotic process automation services by Virtusa shall ensure that banks and financial institutions shift their focus othe n offering of their services to all Mexicas, since their IT solutions shall be ensured by Virtusa intrinsically.

Mexico has recently been subject to several major key sector legislation modifications which included energy, telecommunications, antitrust, education and finance. The financial reforms that were issued by the executive branch in early 2014 have brought commendable changes to the market such as secured transaction legal structures and the increase on credit penetration by the ease of credit offers, thus improving the banks confidence in lending with the assurance of a high recovery rate in the event of execution or foreclosure

By the end of 2018, Mexico's oil and gas industry will be completely open to private investment from domestic and foreign companies across the value chain from oil exploration to gas stations. Since liberalizing its energy markets Mexico has become something of a model for countries that wish to encourage investment, innovation and competition across their energy sectors. These recent developments will go hand in hand with boosting investments that rely on automated banking in Mexico. Robotic process automation will be of great importance to the Mexican investment sectors since all transaction in relation to the renewable energy will be efficient and effective to a wide scale of both foreign and local investors.

Artificial intelligence has led to an increase in productivity in all sectors despite it still been in its infancy stages. It has been predicted that a wave of automation in the banking sector in the next few years in which machines carry out between 10 and 25 percent of banking functions, which will allow banks to increase their ability to react and employees to focus on higher-value tasks and projects. The goal of automation has been to improve the experience of customers who value speed and simplicity in banking shall increase convenience in carrying out business in Mexicans in the rural areas as well in the urban areas (ICCS et al., 2010).

Robotic process automation in the Financial Services and Banking extends the creativity and critical thinking capabilities of human employees and delivers beyond the obvious cost savings, great quality of service, and operational efficiency. Repetitive and low added value tasks can bundertakenen by robots with greater accuracy and speed, thus making it possible for the employees to get involved in other activities that may require real human intervention to navigate efficiently. In the Mexican banking syst,em automation can come in handy once auditing is been carried out. This leaves no room for human errors taking under consideration that corruption in the country has permeated several segments of society political, economic, and social - and has greatly affected the country's legitimacy.

Virtusa will, therefore, re-provide an ideal solution on how to revolutionize banking in Mexico where all Mexicans of all classes and different geographical locations are considered. Automating banking services by partnering with the financial companies and other fintech startup firms would be a further step into the already automated manufacturing and processing systems in Mexico. Automation has seen Mexico grow from one of the poorest to developing countries around the world. Among the factors expected to increase credit penetration in the Mexican market is the inclusion of a continuous growing offer of technology solutions for the banking entities such as mobile points of sale, which are increasingly being implemented by Mexican small businesses (O. E. C.D et al., 2007).

References

Castellanos, S. G., Angel, G. A., & Garza-Garcia, J. G. (2016). Competition and efficiency in the Mexican banking industry: Theory and empirical evidence.

ICCS (Conference), Christensen, H. I., Kruijff, G.-J. M., & Wyatt, J. (2010). Cognitive systems. Berlin: Springer.

Louca, F., & Ash, M. (2018). Shadow networks: Financial disorder and the system that caused crisis.

Publishing, O. E. C. D., & Organisation for Economic Co-operation and Development Staff. (2007). SMEs in Mexico: Issues and Policies. Paris: Organisation for Economic Co-operation and Development.

Ustundag, A., & Cevikcan, E. (2018). Industry 4.0: Managing The Digital Transformation. Cham: Springer International Publishing.

Willcocks, L., & Lacity, M. C. (2016). Service automation: Robots and the future of work.