- Brazilian bank Itaú is moving to make iti, launched in November 2019 as a digital wallet, a complete neobank;
- Downloads of bank apps in Brazil fell in September for the first time since 2015.
Itaú-backed Iti tripled its customer base in 2021 through September to 10 million accounts, as the bank’s fintech is gaining scale to rival Brazil‘s neobanks Nubank and Banco Inter.
The figures come as Itaú begins an iti media campaign, expands credit operations, and begins preparing the platform to create greater engagement, which could involve anything from content to e-commerce.
Itaú is moving to make iti, launched in November 2019 as a digital wallet, a full-fledged digital bank, and shows it has not passively watched the momentum of rivals during the COVID-19 pandemic. PicPay, the country’s largest digital wallet, surpassed 55 million users in September, while Nubank reached 41 million customers by the end of the first half of the year.
“We are perfectly in the game,” iti director João Araújo, who took over the business in March 2020, told Reuters, as social isolation prompted the rapid migration of operations to the digital environment.
Araújo said iti’s expansion takes place within a strategy designed for the business to grow sustainably, which he said is shown by the volume of funds transacted by the platform seven times higher than in 2020, while the average number of transactions per client has doubled.
“We didn’t want to grow for the sake of growing, but to give depth to the business,” added Araújo, a Portuguese-born executive who has been with the Itaú group for nine years.
Downloads of bank apps in Brazil fell in September for the first time since 2015, with experts assessing that new investments from the sector should focus on businesses that start to show signs that they will be profitable.
In this sense, Araújo assesses, iti is well-positioned because it has better performance in security against fraud, credit, and customer service, factors that will determine the winners in the medium and long term.
“To keep our indicators high, every day we interview dozens of customers,” says the executive, adding that iti’s credit offer is driven within the brand’s purpose “to help Brazilians prosper.”
The logic of the campaign is supported by iti’s customer base, 90% of which is made up of people from lower income classes, with 60% of them aged up to 30 years old.
With this horizon, iti is also being a great bet by Itaú Unibanco to expand business in Brazil‘s North and Northeast, regions underpenetrated by the bank, which has concentrated its efforts on expansion in the Centre-South of Brazil, where it has made most of the acquisitions of state-owned banks in recent decades.
“North and Northeast are the regions where iti’s penetration has been the greatest,” Araújo said.
According to the executive, so far there has been no record of a high rate of “cannibalization”, that is, iti is not taking many clients from its own owner, as 80% of the neobank’s clients have never had a previous relationship with Itaú.
Without giving details, Araújo revealed that the group is preparing for 2022 to increase the offer of products and services, including non-financial ones, which may include Itaú’s current partners, which include companies such as Azul, Metlife, CVC, Samsung, and Movida.
“It makes sense to improve synergies,” he said.
(Translated by LABS)