In the last couple of years, the number of fintechs available for Brazilian users has increased at a tremendous rate. The reason? Fintechs are a cheaper and more practical option for people to do multiple bank transactions, turning them into a more appealing way to care for your money.
Because of these major differences, fintechs in Brazil have become increasing challengers to traditional banks, which have been facing the growing demands from the users to modernise and improve user-friendliness in their banking services, similar to how fintechs have done already.
Here are the 5 main reasons why fintechs are catalysing changes in politics inside Brazil’s traditional banks:
1.People are searching for options with lower taxes
Traditional banks usually put high fees on most of the services they offer, charging everything from transfers to investments. Although fintechs still charge for some of their services, they are able to offer lower prices, especially because they are based on lower cost technologies with fewer overheads than traditional establishments in offering modern banking services.
Besides, with more options available to do banking, competition has increased, turning fintechs in Brazil into a more appealing option than using traditional banks for your financial operations.
2.Fintechs offer more services on the same platform
Fintech’s developers have noticed that more and more people are looking for applications that unite as many features as possible – and they’ve gone for it!
Nowadays, it’s possible to find fintech apps available in Brazil which bring together functionalities that wouldn’t be found on the app of a traditional bank.
One example of this is Airfox, who has developed banQi, an app that offers several functions that are useful for the Brazilian population, such as paying bills and topping up their smartphones’ pre-paid credits, all in one place – which are substantial differences in comparison to traditional financial institutions.
3.Not everyone likes to talk on the phone and fintechs recognised it
Differently from the traditional financial institutions that were carrying the financial scenario in Brazil, fintechs have thought about different ways of offering customer support, and this has a great appeal to those who prefer messaging rather than spending arduous amounts of time on the phone waiting for an attendant.
4.Possibility to make investments without leaving home
Some older banks that haven’t adopted the newest technologies demand their clients to go physically in one of their branches to use specific investment, making the access to it harder for people that don’t have enough time to do it during their days. Besides that, fees tend to be big enough to discourage people’s investments.
On fintechs that are investment focused, for example, those barriers aren’t a reality anymore, helping users to invest their money from home and, best of all, not paying large fees.
5.Less bureaucracy in several senses
The bureaucracy adopted by traditional financial institutions is one of the main barriers that obstruct millions of people in Brazil from accessing financial services, besides making everything sound more and more arduous and unappealing to new users.
Now, with the option of going for fintechs that offer better ease-of-use and less red tape, lots of Brazilian users might prefer this option instead of traditional banks, making it possible that not only this market grows, but that the old establishments are defied by the younger upstart businesses.
It’s undeniable that the founders of fintechs in Brazil have shed a light onto a section of the financial market that wasn’t receiving enough attention, obtaining the possibility to grow through politics and services that were hanging on the background along with the population that didn’t feel satisfied or included by the traditional ties. Fintechs aren’t only important locally because of their innovations, but they’re important for the changes they’re promoting every day.