Banco Inter launched this month a marketplace of products and services that could transform it into something bigger than a digital bank: a super app. The new approach is also strategic in terms of reaching an important goal for the Brazilian fintech by the end of 2019.
In April of this year, during an analyst conference, the Brazilian fintech made public its desire to be the country’s sixth largest bank in terms of the number of customers this year. At the time, Banco Inter had about 2 million users.
In July, it announced that it had closed the first half of the year with 2.5 million customers. Now, analysts say, the fintech should be closer to 2.9 million customers.
To be the sixth largest in Brazil, Banco Inter must surpass PAN, Sicredi, Omni, and Banrisul, which have 4.16 million, 4.18 million, 4.44 million and 4.83 million customers, respectively, according to Brazil’s Central Bank (BCB) data. Not to mention Nubank, which closed June with more than 10 million customers, but has not yet acted as a financial institution despite having been authorized to do so since the end of 2018.
These BCB numbers, however, consider not only who has a checking account, but who has credit contracted with these institutions. In Banrisul’s case, there would be about 2.7 million checking account holders – a number much closer to Banco Inter’s.
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With that ambition in mind, and without giving up on being a “bank without asterisks,” that is, to explain in a transparent and easy way all its services and processes, the fintech has just entered a fierce competition.
On the one hand, there are the big retailers and tech companies wanting to offer financial services. On the other hand, there are the big banks as well as the fintechs wanting to offer non-financial services.
In a world with more smartphones than people, everyone wants to be that first-screen phone app, not just for customer loyalty, but also for more revenue.
Who has more user recurrence sells more products and services, which in turn reverts into more earnings. It is the logic of the marketplace taken to a new scale. No wonder this is a fight of titans. To get into the fray, Banco Inter will gradually need more capital.
In late July, the fintech raised BRL 1.25 billion (more than $ 300 million) in a share offering that was mostly won by SoftBank through a Miami-based investment manager called LA BI Holdco LLC.
The Japanese fund took 8.1% of Banco Inter after disbursing BRL 760 million for 19 million units (groups of shares). In a statement, Banco Inter said SoftBank’s investment is a “long term,” meaning that it will not change anything in corporate terms and that the money will be used to achieve the objectives previously disclosed. At the time of the statement, the launch of the marketplace was already under development.
Rewards and a predictive model are two pillars of their new strategy
To run the marketplace, Banco Inter hired Rodrigo Gouveia, former Facebook Global Client Partner for Latin America. In an interview for LABS, the executive said Banco Inter’s race to be a super app has three major points:
-Continued focus on the best possible user experience, with the one-stop shop logic as a mantra for the marketplace;
-a reward policy that goes beyond the typical fintechs zero fare, with solutions like cash back and other no-financial advantages offered by strategic partners.
-and a heavy bet on business intelligence in building a predictive model capable of giving the customers what they need before they even realize it, based on their behavior using mobile applications.
“The super app is born thinking of these three pillars to solve,” Gouveia told LABS.
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Before the launch of the marketplace, the user of Banco Inter could recharge his cell phone, pay for the revolving parking lot of the city of Belo Horizonte, headquarters of Banco Inter, and buy gift cards.
With the opening of the shopping tab about a week ago, users have access to a much larger number of products and services. There are already more than 50 financial and non-financial partners, including Uber, Uber Eats, Spotify, Xbox, ClickBus, Americanas, and Submarino Viagens.
Gouveia explained that within the fintech’s investment platform cash back was already common for some types of investments. Now, with the marketplace, there is an even wider range of partners offering financial and non-financial rewards to its users.
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More than 40 million Brazilians in the sights of Banco Inter
The Brazilian fintech was created 25 years ago by the Menin family, the same that founded the MRV construction company, under the name of Intermedium. The new brand came in 2017 after a deep process of digital transformation. A year later, it was the first Brazilian fintech to have shares listed on the country’s stock exchange, the B3.
Since then, Banco Inter has been looking at both bank customers, who are tired of the lack of transparency and high fees charged by traditional financial institutions, as well as the unbanked customers in Brazil.
In the second case, there are about 45 million Brazilians who, according to a survey by Instituto Locomotiva, either have not had or have used a bank account for more than six months.