Brazilian banking startup Nubank is going to launch its Nu credit card in Mexico in an attempt to capture a piece of the country’s population of 36 million unbanked, according to a report by TechCrunch.
Nubank is valued at around $10 billion, and it’s based in Sao Paulo. The FinTech has raised $820 million through seven investment rounds and has almost 22 million Brazilian customers.
The card is available to all eligible Mexicans over the age of 18, and it has a waiting list 30,000 people strong.
The company’s CEO, David Vélez, started the bank in 2013, having previously worked at Sequoia Capital as a partner in charge of the company’s investments in Latin America.
Nubank has been busy pulling in new talent in anticipation of the expansion, and it the hired three C-level executives as well as a new CFO. Nubank thinks it’s time for Mexico’s young population to become more financially independent with simple and human financial offerings.
It’s offering a credit card without a yearly fee to help simplify the lending process and differentiate itself from the typical Mexican bureaucratic experience.
About 50 percent of the population in Mexico is younger than 24 and while they are digitally literate, due to the current banking system only about 10 percent of adults in the country have credit cards.
Many startups and investors view Mexico as an attractive pool to fish from and get new customers.
Vélez thinks Nubank will catch on quickly and grow due to word of mouth in Mexico, like it did in Brazil. He said about 80 percent of all of Nubank’s customers in Brazil were from referrals, and that he has not spent any money on customer acquisition.
The FinTech’s credit card has been profitable since 2017, but the company itself is not, Vélez said. Nubank has about 2,500 workers from 30 different countries and backgrounds. It’s the sixth largest bank in Brazil and one of the biggest independent digital banks in the world.