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The future of finance in LatAm & the Caribbean

September 19, 2021

Brazilian digital banks attract new customers amid pandemic

Jun 24, 2021

By Roberta Prescott
iupana_panel_neobanks
Leaders of digital banks in Brazil say the onset of the covid-19 crisis has driven greater adoption of their services by customers of all demographics

 

Brazil’s digital banks are taking advantage of the swift change in consumer finance habits since the onset of the pandemic, according to company CEOs.

“Last year was important for digital banks, because the pandemic led people to increase their digital experiences,” Renato Ejnisman, CEO of Next said on Tuesday during a panel conversation at Ciab Febraban, Brazil’s landmark annual conference for the financial services industry.

And with the spread of digital services, the profile of digital banks customers is no longer composed of young people, the company executives noted.

“Mobile is changing the digital economy,” said Chen Kun Te, chief digital transformation officer, financial services business at Huawei Enterprise BG.

Banco Original initially had a predominantly young customer base, said Raul Moreira, member of the boards of directors of Banco Original and PicPay. Today, the bank’s customers are made up of people from the entire social pyramid, all ages. Though, in PicPay the customers are predominantly those seeking new experiences.

Rodrigo Cury, head of BTG+ and a partner at BTG Pactual, added that the digital acceleration has made it easier to reach the entire population.

See also: Brazil’s biggest banks call for level playing field | Ciab 2021

“We are living in an era in which everything is becoming more digital. Today there is a proliferation of digital services and neobanks are generally very close to the users and customers,” added Cury.

Next was launched as a spin-off of Bradesco but became independent last September. The strategy, said Ejnisman, is to become increasingly independent from a corporate perspective.

“What really makes a difference is the customer experience, which has to be unique and extraordinary. Banks have to profoundly know their customers,” he said. “Therefore there’s a huge analytics and artificial intelligence work to be done in order to understand clients’ demands.”

Next has approximately 50 million customers and has grown in scale and products and services’ portfolio. “We are really focused on a data culture and the use of analytics to be more efficient,” Ejnisman noted.

As for Original, Raul Moreira said the digital bank used the regulatory framework in its favor and is evolving to be more complete and to compete with large Brazilian banks.

“We are an open bank with a platform that can be connected with others. Since the beginning it was developed within the concept of open banking,” said Moreira.

See also: LatAm insurtech shifts focus to operational innovation

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