– The growth reflects consumers opening accounts with multiple fintechs to leverage varied benefits such as discounts and early access to events.
- Despite the rapid expansion, Zetta anticipates a market shift with firms likely to focus on client retention rather than new account growth.
In a striking demonstration of fintech popularity, Brazilians have opened more individual accounts (251 million) than the country’s total population (220 million), a recent survey by Zetta disclosed in interview with Bloomberg.
Founded by industry leaders Nu Holdings Ltd. and MercadoLibre Inc., Zetta reported a 77% increase from the previous year. This growth is largely fueled by consumers diversifying their financial services to take advantage of specific offers provided by various fintech companies.
According to Rafaela Nogueira, Zetta’s chief economist and public policy manager at Nubank, the plethora of choices available to Brazilian consumers fosters robust competition within the sector. The surge in account openings has occurred amidst a broader financial context where many consumers are struggling with debt repayments due to rising interest rates, indicating a shift in consumer behavior towards fintech solutions.
However, the rapid expansion phase may be winding down, as Nogueira predicts a slowdown in new account creation, with future market dynamics likely to center around firms competing to capture and retain customers from each other. This anticipated shift could redefine strategies within the fintech industry, marking a new phase of competitive intensity as companies vie for a stable customer base amidst slowing growth.