Such companies usually have better rates for returning customers. Later, if you assume that for new unknown customer the delinquency probability cost has to be fixed in the price, then annualising the rate of short term loan makes it really scary.

In your example: the bank lending rate in MX is already more than twice than US. I do not know about Mexico, but such businesses are usually also regulated, wich is good, because at one end market knows the local conditions like capital cost and risk and at the other they do not fall into usury. And I believe that it is actually financial apps that have some chance to democratize it more. It is not fair that usually the poorest pay the price, but the whole system is not fair. Load that is not repaid is not only revenue loss, it is also loss of capital (that company is obliged to protect) as there are really slim chances/high price to recollect. Since banks take customers with low default probability, here risk has to be unfortunately priced in. To customer belonging to high risk group (which would be main customers of lending apps) banks simply refuse to even start conversation about credit.

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