With $3.3 billion in deposits and 8 million customers, Mexico already stands out among Nu's operations
August 19 2024 - 4:52PM
Business Wire
High GDP per capita coupled with low financial
inclusion make the Latin American country a significant opportunity
for the company's strategy; Cristina Junqueira details plans on the
new episode of Nu Videocast
Standing as the number one business priority for Nu in 2024,
Mexico has proven to be a savvy choice in the company's
international expansion strategy: one year after the launch of
Cuenta, the company has already surpassed 8 million customers in
the country and $3.3 billion in deposits. These figures exceed
those of Brazil at the same stage of operations: in the company’s
home country, there were 7.7 million customers and less than $1
billion in deposits in Q1’19.
With the highest GDP per capita in Latin America (over 30%
higher than Brazil's) but low financial inclusion, Mexico has a
unique combination in the region, making it a significant
opportunity.
This assessment comes from Cristina Junqueira, Co-founder and
Chief Growth Officer (CGO) at Nubank: "There is a lot of room for
growth due to the low reach of financial services in Mexico. In
such a large and even wealthier country than Brazil, we see that,
in certain scenarios, it could be (a market) even bigger than what
we have experienced here."
Cristina made the statement during her participation in the
latest episode of the Nu Videocast, a corporate series that
discusses strategic themes at Nubank with the company's senior
leadership.
"We are very proud of this. When we went to Mexico, we had no
idea what would happen. Part of us was thinking: ‘Could any other
country be as big or as successful as what we have done in Brazil?’
And when we compare (the operation in Mexico) with Brazil at the
same stage, we see that Mexico is really ahead."
The phenomenon is mirrored in Colombia, where over 500,000
Colombians opened a Cuenta within two months of the product's
official launch, and deposits have already surpassed $500 million
as of August. At the close of Q2'24, deposits were at $220
million.
The same philosophy; A different profile
The successful experience in Brazil has facilitated different
aspects of implementing the operation in Mexico, especially in
terms of technology infrastructure. At the same time, Cristina
emphasizes that success in Mexico owes a lot to the continuous
effort to adapt to the Mexican customer's profile.
"Our biggest competitor (in Mexico) is cash. Over 40% of
payments in Mexico are still made in cash; half of our customers
have never had a credit card. So, there is strong work in financial
education underway, so they can start using the products
responsibly."
The company's strategy of offering attractive returns on
deposits has also been effective, as it encourages customers to
keep their money with the institution, which helps finance the
growing credit portfolio.
Currently, Nu offers various returns in Mexico, depending on the
liquidity of the investment in the Cajitas – the local 'Money
Boxes'. This strategy, which promotes good financial habits,
enables the company to provide one of the most competitive returns
in the market, adapting to Mexico's macroeconomic and competitive
factors.
For Cristina, offering a digital and secure option that
remunerates deposits above inflation and enables customers' capital
growth is transformative: "It's something that can change these
customers' lives. It's the gateway to a financial life," she
highlights.
The future in Mexico
Nubank's total investment in Mexico has already exceeded US $1.4
billion, reflecting its long-term commitment to the country and
making it one of the most important foreign investors in the
Mexican financial sector.
In this context, Nu has previously filed a formal application
with the regulator to obtain a local banking license, which would
allow it to offer more services.
Cristina's expectations are positive: "We are optimistic about
the feedback we have received on the pace things are moving, on the
level of information, and with the level of exchange we have had
with the different regulators involved in the banking license
process. We are very excited to see this happen in the future," she
concludes.
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version on businesswire.com: https://www.businesswire.com/news/home/20240819761268/en/
Investors Relations: J�rg Friedemann investors@nubank.com.br
Media Relations: Leila Suwwan press@nubank.com.br
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