Argentine financial services startup Ualá has reached an agreement to buy Mexican bank ABC Capital SA, as part of its bid to keep growing abroad.

Ualá, which was valued at $2.5 billion in its latest financing round, will acquire 100% of Monterrey-based ABC Capital, according to its founder and chief executive officer Pierpaolo Barbieri. As part of the transaction, ABC’s existing shareholders will become minority shareholders of Ualá. The value of the transactions were not disclosed, and the purchase is subject to approval from Mexico’s regulators.

“Our commitment to financial inclusion in Mexico is absolute,” Barbieri said from Mexico City. “The acquisition of ABC bank will allow us to offer a far wider variety of financial services within our ecosystem, as well as greatly accelerate our growth in the Mexican market.”

For Ualá, which provides a slew of financial services through a mobile app, the deal will include access to ABC’s bank license, allowing it to boost the number of services it can offer in Mexico. The purchase also marks the company’s second partnership with a bank to grow its business. In April, it reached an agreement to buy Argentine digital bank Wilobank, a deal that is also pending regulatory approval locally.

Ualá launched operations in Mexico in September 2020 and has already issued 350,000 prepaid cards there. It’s the latest South American company to jump into Mexico’s bustling banking sector, where a growing group of startups are consolidating as they take on big global banks that dominate the country. MercadoLibre Inc is growing quickly in the Mexican fintech space while Nu Pagamentos, or Nubank, is entering the country backed by JPMorgan Chase & Co., Goldman Sachs Group Inc. and Bank of America Corp.

Still, neither has a banking license, with Nubank announcing in September that it bought a non-bank lender in the country.

Ualá is backed by heavyweights including Japanese conglomerate SoftBank Group Corp, Chinese Internet giant Tencent Holdings Ltd., and billionaire George Soros.

Monterrey-based cement maker Cemex SAB de CV is one of the top shareholders in ABC Capital, according to its website.

— By Carolina Millan and Jorgelina do Rosario