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Future of Finance
New technology is upending everything in finance.
As digital banking startups catch on around the world, Nubank has taken a commanding lead when it comes to app downloads. The Brazilian company’s rapid growth shows the promise of mobile banks in developing markets, where much of the population doesn’t have adequate financial services.
Nubank’s app has been downloaded 18 million times in the past year, which is more than Revolut, Monzo, and N26—three fast-growing European neobanks—combined, according to Apptopia. The Brazilian bank’s monthly active users have also increased by more than 200% during that span, which is more than just about any other upstart bank apart from Monzo.
Developing markets are fertile ground for newfangled financial apps. The likes of Alipay and WeChat Pay (Quartz member exclusive) in China, and M-Pesa in Kenya, have shown that these countries have vast, underserved populations that can be reached quickly via mobile phones.
What is less clear is which of these upstarts will figure out how to make money, and whether they will be as successful in places where banking services are already entrenched. In the US, JPMorgan said 36.5 million of its customers were active users of its mobile app in the third quarter, an increase of more than 1 million from the previous three-month period. London-based Barclays has more than 8 million mobile banking users. PayPal and Square’s Cash App had more 61 million and 38 million app downloads in the past year, respectively, according to Apptopia.
“Our belief in the US and Europe is generally that people are well banked. They’re just not well served from a consumer experience perspective,” Tripp Shriner, a partner at Point 72 Ventures, told Quartz earlier this month. “As you move toward more emerging and developing markets, that’s not necessarily the case. There are large portions of the population that actually aren’t well served, and they are underbanked or unbanked.”
Nubank says it has 15 million customers, a 25% increase from the figure the company cited in August, according to Reuters. The six-year-old fintech firm also operates in Argentina and Mexico. It raised $400 million in funding in July, according to PitchBook, at a valuation of $10 billion. Tencent, the company behind China’s ubiquitous WeChat Pay, was among the investors.