The Brazilian fintech Nubank arrived in Mexico, according to Business media. Nu will be the name of the company in the country, which will seek to compete with the traditional banking system.
Nubank began operations in Brazil six years ago as an alternative to traditional banks. In that time, Nubank went from having 12 clients to 8.5M users. Since then, this Brazilian fintech has grown with the founding of different venture capital firms such as Sequoia Capital, Founders Fund, Kaszek Ventures, Tiger Global Management, Goldman Sachs, until becoming the third Brazilian startup to achieve the status of ” unicorn “(after PagSeguro and 99) in 2018.
In this year, the company announced the start of operations in Argentina and now in Mexico. These announcements talk about a process of international expansion that the company is experiencing, mainly towards Latin American markets where the level of banking penetration is deficient, and there is a lack of confidence in traditional financial services.
David Vélez, CEO of Nubank, commented on the current expansion process that the company is undergoing: “We finally took the step of taking our revolution to new markets, and we see a great opportunity to do the same in Mexico.”
Velez said that before arriving in the country, the company studied the Mexican financial system for several years, as well as consumer complaints about traditional banking.
Nubank is focus on customers
As a bank, Nubank is a digital native and seeks to distinguish itself from traditional banking by focusing on customers. On this subject, Vélez said «We created a company focused a 100% on the client and a product that solves their problems. When you see the traditional banking industry in all countries are oligopolies that 4 or 5 banks own 70-80% of the market, then there has not been much competition. You want a credit card or a bank account, and they are doing you a favor, and it must be the opposite. “
In recent years, traditional banks have introduced digital products such as mobile banking or new electronic payment options. However, Vélez does not consider that they represent a problem for the growth of the company. «Banks now see the success we are having, and logically they are in a stage of reinvention of their business. Some of them still think that the challenge is to create a better website or a better app, which often seems like a Blockbuster wanting to compete with Netflix, or taxi drivers creating an app to compete against Uber. It’s not just technology; it’s more a cultural challenge ».
Both Mexico and Brazil are fintech leaders in Latin America, occupying the second and first place in the region of ventures related to digital financial services, according to data from Finnovista.