Nubank reaches 100 million customers across Latin America

Brazilian neobank Nubank made headlines yesterday by announcing it had reached 100 million customers across Latin America. The milestone made it the first digital bank outside Asia, according to a securities filing, and cemented its reputation as a serious competitor to traditional banks in the region.

The fintech phenomenon is extending its influence across the continent, particularly in Brazil, where it has established its core business. In recent years, the company has worked to replicate this success in Colombia and Mexico by accelerating its operations in these markets. Recently, Nubank announced a new $100 million investment in Mexico, aiming to ramp up customer acquisition efforts in the country.

David Vélez, CEO and co-founder of Nubank.

With over $1 billion in net profit reported for 2023, the digital bank is clearly riding a wave of momentum, firmly establishing itself well beyond the break-even point. The company is expected to report earnings for this year’s first quarter next week, while its shares are trading up nearly 45% year to date on the back of last year’s strong results.

Nubank, a fintech disruptor from Latin America

“In 2013 we set ourselves the ambitious goal of reaching one million customers in five years, which at the time seemed almost impossible,” CEO and co-founder David Velez said in a statement. In a decade we have exceeded 100 million.”

Nubank disrupted the Brazilian banking landscape throughout the 2010s, experiencing accelerated growth throughout the decade. Its expansion led to an initial public offering in US markets in late 2021, which allowed it to raise sufficient funding just before public markets took a turn for the worse the following year.

The majority of its business, however, continues to come from the domestic market. Currently, Nubank serves more than 92 million customers in Brazil, 7 million in Mexico and nearly 1 million in Colombia. They still have room to grow as there are many Latin American countries where they do not yet operate, and the neobank has argued for increasing market share in the range of financial products it currently offers in Brazil.

“We are still in the early stages of banking cracking in Brazil,” said David Velez, CEO and co-founder, in a recent interview celebrating this milestone. “We have 53% of the Brazilian adult population as customers, but we have small market shares in all verticals. There is an opportunity to continue to grow market share in every (product).”

Over 100 million: growing in Mexico is Nubank’s priority

Velez made it clear that aggressive expansion into Mexico is at the top of his priority list for the year. Last year, the company introduced a consignment product, paving the way for it to significantly accelerate its pace of expansion in this critical North American market.

With nearly 2 million new customers added in the last quarter alone, the digital bank is leveraging high-yield accounts to lure customers away from traditional banks. This strategy, Velez said, “accelerated our company-wide flywheel in the country and solidified NU as the undisputed leader in the digital banking category in Mexico.”

The Mexican market is emerging as the next battleground for digital banking expansion in Latin America, attracting both local operators and international fintechs eager to take advantage of its population of 130 million and drive the adoption of online banking services by reducing the at the same time the dependence on cash.

• David is a Latin American journalist. He regularly reports on the region for global news organizations such as The Washington Post, The New York Times, The Financial Times and Americas Quarterly.

  He worked for S&P Global Market Intelligence as a Latin America financial reporter and gained experience on fintech and market trends in the region.

  He lives in Buenos Aires.

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