Brazil and Mexico
Press Release

Brazilians are the ones who most use financial products in Latin America, says Mambu study

Bnamericas Published: Monday, January 23, 2023

This is a machine translation of Mambu's press release

São Paulo, January 19, 2023 -- According to a new study by Mambu, a fintech world leader in technology for financial institutions, younger Brazilians, aged between 18 and 35, are the ones who use financial products the most in America Latin. On average, each uses 3.09 products -- more than Argentina (3.06), Peru (2.83), Colombia (2.45), Chile (2.38) and Mexico (2.2).

Brazil recorded a high number of products used per person, despite having one of the most banked populations in the region, with 70% of adults having access to banks (and second only to Chile, with 74%, according to data from Global Findex). According to the study, the result is surprising, as the trend is that in countries with greater access to banks, the need to acquire extra solutions and even look for other financial institutions is smaller.

Mambu's analysis indicates that the result is due to the technological maturity of the Brazilian market. The country, for example, is the only one in Latin America where more than half (54%) of young people use neobanks or digital banks as their main financial institution instead of traditional banks, a much higher rate than other countries -- in Argentina, in second place in the comparison, only 21% of young people prioritize neobanks.

“The trend, with greater banking, is a lesser need to use products and services. The Brazilian financial system, however, is very peculiar and complex when compared to its peers in Latin America: in the last 30 years we have gone through hyperinflation, closure of the import market, exchange rate freeze, forced price freeze, financial confiscation of investment, among other things. These are factors that have shaped the behavior of Brazilians up to the present day, as in the case of the habit of monthly shopping -- something unusual in other countries and a legacy from the hyperinflation period, when prices rose so much daily that people, When they received their salaries, they ran to the supermarket to buy groceries”, analyzes Laércio Fogaça, head of solutions engineering at Mambu in Latin America.

This scenario, according to Fogaça, over the years has led to the creation of complex financial mechanisms, with players seeking to innovate in their products and services to meet the most diverse needs of consumers. “The growth of digital banks and neobanks takes place in this context. In addition, they are institutions that normally do not have a physical branch and tend to cross-sell products more than traditional banks”, he assesses.

By analyzing the results across Latin America, the study identified the correlation between the use of neobanks and the increase in demand for products cited by Fogaça: on average, those who have a neobank as their main financial institution use 3.1 products and 8.6 services -- above average for traditional bank users, with 2.6 products and 7.6 services per person.

Chile and Argentina are also examples of this trend. In the first country, where 97% use a traditional bank as their main financial institution, the demand for products is low compared to other countries in the region, at just 2.4 per individual. In Argentina -- with only half of the country banked (49%), but a rate of 21% of the population using a neobank as their main institution -- the average number of products per individual is high (3.06), second only to Brazil.

Payments are the most used services and debit card leads in products

In terms of financial services, payments are the most popular. Although the demand is not uniform, the option was selected by 62% of the respondents in Latin America, followed by the banking application service (55%) and the receipt of payroll (51%). Among the products, debit cards (74%), savings accounts (57%) and credit cards (35%) were the most popular.

According to the study, consumers in more banked countries demanded more savings accounts and debit cards, while in unbanked countries, demand went beyond these two products, reaching current accounts, digital wallets, credit and deposit accounts. In Brazil, the second most banked country, the three most used financial services were payment of bills (69%), followed by payments in general (67%) and banking application service (67%), while debit cards (69% ), current account (55%) and savings account (52%) led among products.

Methodology

The report “ Take Action! What Products and Services Are Used by Young People in Latin America? ” is the third in a series of four publications by Mambu. To formulate the study, the company consulted, in mid-2021, 1,250 people between 18 and 35 years old in six Latin American countries, including 222 Brazilians.

About Mambu

Mambu is a German company founded in 2011 and the world leader in core banking (SaaS) solutions for financial institutions. Native in the cloud, it is a company with a high growth rate (scale-up company), having raised USD 265 million in the last round of investments and with a valuation of USD 5.5 billion. Mambu is an API-based platform that pioneered the concept of composable banking that allows customers to compose the banking experience best suited to their business without being tied to a specific vendor, system or technology. Mambu is present in more than 65 countries and is now expanding its operations to new markets such as Brazil, Japan and the United States. The client portfolio includes Itaú Ank, Santander Asto, ABN New10, Afinz, Bankly, BTG, OakNorth, Tandem, ABN AMRO, Bank Islam, Orange Bank and many others. To learn more, visit the company's website .

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