SAO PAULO — Brazilian startup Nubank said on Tuesday it would expand from credit cards into digital accounts allowing users to make transfers, pay bills and earn more interest than average savings account, beefing up its challenge to traditional banks.
As the biggest new technology company breaking into Brazil’s banking sector, Nubank has boasted since 2014 of its simple digital interface, low interest rates and lack of tricky fees for its popular purple credit card.
Yet only 2.5 million Brazilians have opened a Nubank card of more than 13 million who applied, due to strict credit checks — an obstacle the company is lifting for the new accounts.
“Our real revolution begins today,” founder and Chief Executive David Velez told an audience at Nubank’s Sao Paulo headquarters, pacing the stage in jeans and a black T-shirt. “Now we are offering services to 100 percent of Brazilians.”
Tech-savvy millennials have been the core demographic for Nubank’s credit card, but Velez said he hoped new accounts would serve some of the roughly 60 million Brazilians – around 30 percent of the population – who do not have a bank account.
Registered as a “payment institution” under new rules defined by Brazil’s central bank, Nubank will invest clients’ money directly in public debt and offer them 99 percent of the interest, charging a small fee for its services.