Brazil: A self-reporting take on digital finance
The process of financial digitalization has been a challenge for journalists covering Brazil’s banking sector.
First there is the tech itself. And while tech in finance is admittedly not a new addition to the beat, the pace of expansion has become to feel a little intense.
It’s not just that innovation is coming in faster waves or that it’s increasingly complex, it’s that technology is now actually changing business strategy. It is creating brand new ecosystems, rather than just giving a productivity jolt to existing financial segments.
It’s all been a bit bewildering – for this journalist at least.
It’s also fascinating, but to keep on top of the subject – more than 600 fintechs now operate in Brazil alone, according to the central bank – I’ve been focusing reporting at Euromoney’s natural audience. And that means focusing on scale.
What are the big, incumbent banks doing to retain scale? Which of the new payments systems do I need to look at, which digital banks already have either scale or the potential to grow rapidly?
Increasingly I have been working on the theory – set out in November’s article ‘Can credit pop Brazil’s fintechs?’ – that the provision of credit will create a natural barrier to the creation of scale.