Brazilian digital lender Nu Holdings Ltd. has won government approval for a license that will allow its unit to operate as a bank in Mexico, marking the first move on the virtual financial institution’s path to letting the fast-growing firm expand its product offerings.
The board of Mexican regulator Comision Nacional Bancaria y de Valores, which includes representatives from the finance ministry and central bank of this country, cleared Nu Mexico Financiera’s application to be a commercial bank. The relevant information is contained in a filing with the US Securities and Exchange Commission.
The authorities will examine the digital lender’s systems as part of the second process, which will result in a decision regarding wider operations approval. Currently, the virtual financial institution does not have an estimate of how long it will take. This was stated by Romina Benvenuti, Nu Mexico’s head of public affairs.
Nu chairman and co-founder David Velez said that the license will allow the digital lender to offer better products to customers and make its business model much more solid.
Nubank already has a license for non-bank lending. In this case, a financial institution may offer credit cards and accept deposits in Mexico. After full authorization, Nubank will focus on payroll loans. This was stated by Ivan Canales, Nu Mexico head. It was also noted that currently, only 36% of the adult population in Mexico has access to the mentioned loans. Besides, Ivan Canales stated that in this country, 90% of the market is concentrated in five banks.
As we have reported earlier, Neobank Bunq Plans to Get US Banking License
