Business

Brazilian fintech Neon acquires the country's oldest broker to create its own investment platform

With 9 million accounts open, Neon wants to bring new products to its lower-income customers

Brazilian fintech Neon's headquarter
Neon's headquarter. Photo: Neon/Facebook.
  • With Brazil’s interest rates at an all-time low of 2.25% per year, the search for more profitable investments is growing in the country, even in the midst of the pandemic;
  • Maggiano’s 15 employees will be incorporated by Neon, but the broker’s client portfolio is not part of the deal because it had already been sold to Guide before.

Brazilian fintech Neon bought Magliano, the oldest securities broker in Brazil, according to NeoFeed. With the deal, the neobank will join the Brazilian platforms race for providing investment services – but in a different way. With 9 million accounts open, Neon wants to bring new products to its lower-income customers.

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“With low-interest rates, those who do not have an investment platform will have a worse product,” said Jean Sigrist, president of Neon, to Neofeed. With Brazil’s interest rates at an all-time low of 2.25% per year, the search for more profitable investments is growing in the country, even in the midst of the pandemic. Last week local media outlets revealed that PagSeguro, known mainly for its payments operation, also wants to open its own investment platform.

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Last November, Neon received a BRL 400 million investment from Banco Votorantim and the American fund General Atlantic. But that did not stop the fintech from feeling the negative impact of the COVID-19 crisis, as it had to lay off 10% of its staff two months ago.

Maggiano’s 15 employees will be incorporated by Neon, but the broker’s client portfolio is not part of the deal because it had already been sold to Guide before.