Key facts
- Paraguay's central bank placed ueno into resolution on November 3 after concluding it lacked capital to cover risks from loans to connected companies.
- The collapse left roughly 3 million customers temporarily unable to access accounts, per the report.
- President Pedro Alliana said 95% of ueno depositors had been reimbursed through the deposit guarantee fund.
- Prosecutors charged 35 people so far over the collapse, the report said.
- A local merchants' association estimated about 80% of Mercado 4 vendors used ueno, per the report.
- Ueno branded itself Paraguay's 'undisputed leader in financial inclusion'; informal employment was 60% of the workforce last year.
Paraguay's central bank placed digital bank ueno into resolution on November 3 over solvency concerns, freezing millions of accounts and triggering the country's biggest political crisis in more than a decade, Reuters reported on November 11.
The central bank intervened after concluding ueno did not have enough capital to cover the risks associated with loans it had made to companies with which it was connected. The bank's collapse left roughly 3 million customers across Paraguay temporarily unable to access their accounts while authorities work to reimburse depositors and transfer customers to other banks.
At Asuncion's Mercado 4, where a local merchants' association estimated around 80% of vendors used ueno, the bustle between once-crowded stalls has largely vanished as sellers try other banks or return to cash. "Most have lost a lot of money. They're really affected," said Elvia Quiroz, a 60-year-old clothing seller. Hilaria Escurra, a 48-year-old fruit vendor, said she was still waiting for her money and felt it would be difficult to trust banks again.
Ueno launched in 2021 and obtained its banking license in 2023, branding itself Paraguay's "undisputed leader in financial inclusion" in a country where informal employment accounted for 60% of the workforce last year. Leonardo Ojeda, president of the Mercado 4 Merchants Association, said the bank transformed how business was done at the market in a remarkably short time.
Santiago Peña, who had business ties to the group behind ueno and tapped ueno's former president Carlos Carvallo to lead the central bank, was impeached and removed from office last week. Prosecutors later charged both Peña and Carvallo with breach of trust and administration for personal gain; they have denied wrongdoing.
Paraguay's new President Pedro Alliana, who took office last week, said on Tuesday that 95% of ueno depositors had been reimbursed through the country's deposit guarantee fund, and the rest would be completed by Wednesday. Prosecutors have charged 35 people so far in connection with the bank's collapse.