Improving Financial Health Across Brazil: Mastercard and Nubank Collaboration

A recent study conducted by Brazilian neobank Nubank and payments giant Mastercard has revealed that around 84 per cent of adults in Brazil have access to financial accounts. This statistic highlights the country’s readiness to enhance its overall financial health and increase financial inclusion.

According to the findings of the study, Brazil stands out in Latin America for its potential to grow financial inclusion and health. The country boasts a 70 per cent card penetration rate, 55 per cent card usage rate, and a high level of real-time payment usage.

The study also emphasized the significant economic and social impact that providing financial services to unbanked and underbanked populations could generate. In fact, 60 per cent of Nubank’s customers transitioned from financial access to usage within 24 months, with 40 per cent achieving this transition within just 12 months, regardless of income level.

However, the study pointed out that while the majority of adults have access to financial accounts, many may lack the necessary financial education to progress further along the financial inclusion journey. Cristina Junqueira, co-founder and chief growth officer at Nubank, highlighted the importance of financial education in empowering individuals to make informed decisions about their finances.

The study also found that active financial product usage can increase familiarity and trust, accelerating financial inclusion. Using prepaid cards for payments can serve as a stepping stone to accessing more advanced financial products. Around 80 per cent of individuals who used a prepaid card as their first financial product eventually moved on to access loan products, and 36 per cent progressed to make investments.

Marcelo Tangioni, division president for Brazil at Mastercard, emphasized the non-linear nature of the journey to financial security and health. He stated that understanding the barriers to financial inclusion and deploying inclusive digital solutions are crucial in accelerating this journey. Tangioni highlighted the importance of frequent, responsible use of digital payment tools in building trust and improving financial health.

Overall, the study underscores the importance of providing digital payment tools alongside financial education, promoting responsible credit use, and investing in micro, small, and medium enterprises to bring more people into the digital economy and accelerate their long-term financial health.