Business

Cielo expands credit and prepares sale of assets while waiting for WhatsApp

Sale of assets is part of a business overhaul to focus on Brazil and digital businesses targeting small businesses

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  • Focusing on small businesses, Cielo saw its profit grow 37% even without expanding its revenue;
  • The strategy is to expand credit products and increase the customer base that sought credit to 40%;
  • The company is awaiting authorization from the Central Bank to use Whatsapp in payments.

Cielo will sell some non-essential assets pending approval from the Central Bank to use WhatsApp in payments and expand the offer of credit products as part of a business overhaul to focus on small retailers.

By focusing on small businesses, Cielo saw its profit grow 37% year over year, even without expanding its revenue, affected by the Covid-19 pandemic.

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The strategy of expanding credit products is expected to grow in the coming months, after Cielo received an endorsement from its controllers, Bradesco and Banco do Brasil to have a direct credit company. With this, Cielo intends to increase the customer base seeking credit to 40% by the end of 2021.

Focus on Brazil and digital business

Cielo plans to dispose of assets it does not consider essential, opting to focus on Brazil. One of the alternatives is the possible sale of MerchantE Solutions, in the United States. In October, Cielo had already sold its share of the Brazilian Service Management Company (Orizon) to Bradseg for BRL 129 million.

“We are looking at opportunities to dispose of some assets in a viable way,” said Paulo Caffarelli, Cielo’s chief executive. The plan to increase investment in digital businesses may include new acquisitions in the future.

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Cielo also believes that the Central Bank will authorize the use of Whatsapp in payments until June. The partnership announced in June last year was suspended by the Central Bank.

Translated by LABS.