Miami — Inter&Co (INTR), a Brazilian fintech powerhouse, has taken its global ambitions to new heights since listing on the NASDAQ in 2022, showcasing notable growth in revenue and client base. Led by CEO Joao Vitor Menin, the company has navigated high interest rates and Brazil’s fiscal challenges to expand its lending portfolio and reach more than 30 millions of users. Now, Inter is setting its sights on the rest of Latin America, with the eventual goal of reaching Spain and Portugal, as well.
This strategic expansion, built on digital innovation and tailored financing, has positioned Inter as a serious competitor in the crowded neobanking space.
Central to Inter’s success is a diversified approach to funding and credit offerings, a cornerstone of its strategy amid global economic uncertainty. Menin credits the company’s lower cost of capital and extensive digital ecosystem as critical factors in its ability to attract clients and maintain steady growth.
In the US, where Inter recently launched its global account product, Menin sees opportunities not only to expand financial services for Brazilian expats but also to keep adding to a comprehensive “super app” tailored to US consumer demands.
As Inter & Co grows its footprint, Menin faces the dual challenge of adapting to the competitive US financial landscape while meeting the distinct needs of Brazilian and Latin users. With US expansion firmly on the agenda, Menin has been leveraging strategic alliances, like a marketing partnership with the Orlando City Soccer Club, to build awareness and capture market share.
Through this multifaceted approach, Inter aims to reshape digital banking and deliver a streamlined, cross-border financial experience for clients across the Americas, and eventually in Europe, starting with Portugal and Spain. Inter notes, however, that these plans are not part of the company’s immediate future.
The following conversation has been edited for length and clarity.
Bloomberg Línea: Inter & Co has been listed on the stock exchange in the US for a couple of years now. Since then, your number of clients, revenue and loan portfolio have been rising sharply. How has that been possible in this higher rate environment, and how sustainable are those growth rates?
Joao Vitor Menin: A combination of two things. First of all, we have a very diversified credit portfolio. Some of them are not too impacted by the rates, such as mortgage, payroll loans in Brazil. So despite of the rates going up or down, it doesn’t impact the growth of the portfolio too much. Second, we were able to bring a lot of clients to our ecosystem, mainly through our digital account. And with that in place, we were able to get our funding franchise. We have the best cost of funding in Brazil today, better than the incumbent banks, and that helps us to underwrite amongst millions of clients in a very easy way, through the app. These things were able to help us to grow the portfolio. And at the end of the day, the portfolio helped us to bring in more revenue, which helped us dilute the fixed cost, and that meant better earnings, quarter over quarter. That’s the way Inter is working today.
How much of the revenue is currently coming from the U.S.?
We don’t disclose that number, although what we disclose is that we have 34 million clients in Brazil as of today, and 10% of these clients also have the global account product, which is the account in the U.S. We also have another 250.000 clients in U.S. soil using our account. So we have roughly 10% of our client base using the U.S.-based account for payments, remittances, investments, and so on. And we expect it to grow considerably going forward. We see that the pace of growth here is higher than the pace of growth in Brazil. We believe that this 10% eventually will turn out to be 15-30%.
Do you have any concrete numbers to share regarding your marketing push in the U.S. market, in part through the alliance with Orlando City Soccer?
Yes. When we see these 250,000 clients that we have here in the U.S., we see that a big portion of them are in central Florida, where Orlando is located, where we have that partnership, including the Inter&Co Stadium. Following the announcement of the stadium’s naming rights, we saw a sharp increase in the number of accounts from that region. Just to give you a sense of how important these partnerships are for us to promote the business and the brand here in the U.S..
What are your main takeaways on the difference in penetrating the Brazilian digital market versus the U.S. digital market?
I think it’s different. We’re still learning, to be honest. We have been expanding here for two years or so. I would say that Brazilians were prone to trying something new. They used to be underbanked, so they were eager for something different. The U.S. is a different approach. On the other hand, in the U.S. system, retail banking is not as evolved as in Brazil, so they’re looking more for convenience. So should I have five, six, seven different apps, different bank relations to run my financial life? Maybe you don’t need to. Maybe you can have the convenience of a “super app”, and you can do investments, insurance, mortgage, credit card payments, remittances, and so on in one place. So that’s what we are very excited about bringing this convenience to clients here in the U.S. And of course, we are trying to get as much tailwind as possible, to focus first on the Latinos and the Brazilians.
What do you think the main successful revenue pools will be in the U.S. market?
We are very, very focused on having a diversified revenue pool. So we are not looking to have just to be like a monolith. We’re strong in revenues coming from remittances, payments and mortgages. We want to have this diversification. And as of today we don’t disclose the revenue here in the U.S., but it’s very well balanced, very well diversified. So we have four or five different revenue streams, each of them accounting for 20% or so of the revenue.
Credit cards? Investments?
Credit cards, investments, commercial shopping deals, remittances, and investments.
You’ve been living in Miami for a while. Would you say that’s had any impact on your approach to leadership and management, and on the culture at Inter in general?
Yes, for sure. I was born and raised in Brazil, in Belo Horizonte. So it’s my first time ever living abroad, while also running a company of 4,000+ people. Of course, I fly to Brazil every month. I spend one week there, to learn how to manage the company from abroad, and also how to be inspired and to get in touch with the trends that are happening here in the U.S., which is the place for innovation and technology. I look to spread these trends, this culture, amongst our top-level executives. It’s been very interesting. So I ask myself how I can try to foresee the trends, and how can I translate that into our team, in order for them to help me run the business in the right direction. It’s a new type of leadership that I’m learning, but so far I believe that it’s working really, really well, and I’m very happy being here, living in Miami. Miami is a very good place to connect with these new trends, new things, new technologies and different types of growth.And of course, now that we’re aiming for this global expansion, we don’t see Brazil as our only market. It’s going to be a big, but just another market down the road. Being here in one of the most interconnected cities in the world, it’s very helpful.
What does your talent retention strategy look like, being in a hyper-competitive market, the financial center of the world?
Yes, what we have been doing at Inter for a while, and it’s working really well, and the reason why we’re able to retain a lot of our talents on every single level is because we have this culture of encouraging people to try, to test, to innovate, to get into contact with the most interesting things happening in the industry. So they like to be a part of it. I know that if I’m at Inter and I work in IT, I’m going to be using and testing the most advanced technology. If I’m in the legal team, I’ll also be able to try different things. So for instance, we did our migration from the Brazilian exchange to the NASDAQ in 2022, and this type of transaction was the first of its kind ever in the world. A regulated, listed bank in Brazil converting to a regulated, listed company in NASDAQ. So if you ask our legal team that worked on this transaction, they could have never imagined that they’d be part of such innovation. That’s the type of thing that keeps people motivated, engaged. And at the end of the day, of course, they perform well and the company’s performing well, so we can also pay them accordingly. But it’s not about the paycheck, it’s about the ability to do things different and to try new things. And that’s what people, most of the people are looking for.
What was the rationale behind the decision to relist rather than stay listed in Brazil and also do an IPO in the U.S.?
Okay, so first of all, to do an IPO here with the company already listed in Brazil would be very complicated. And the reason for us to decide to move from Brazil to US, it’s pretty easy to understand. We see US as by far the largest capital market in the world. Brazil, unfortunately, doesn’t have a very well-developed capital market yet. And when we see Inter as a tech company, a super growth company, we wanted to be close to the long-term investors that would help us fund the growth of the company going forward. So we decided to bring the listing to US. As I mentioned, not easy at first, a very complicated transaction, but it worked. And very happy to see that today we have more liquidity here in the US than we had in Brazil. I would say that two years after, it has been a very successful project.
There’s been a lot of noise among investors in Brazil about the fiscal situation and higher taxes moving forward. What’s your take on that scenario?
Yes, I think that we have this issue with the fiscal deficit in Brazil and I’d say other economies are also having it. We now have a push in the interest rates. They initially moved down in Brazil, and now they have risen after the last central bank meeting. And that brings attention to the banks because maybe the delinquency can improve. It brings attention also to the consumers, because they are maybe not that optimistic about getting a mortgage loan or a long term loan. But on the other hand, I like to say that we are a business, we are a player, that is trying to produce alpha and not beta. So we know that the market is going to have its ups and downs. The markets may sometimes help, sometimes they will not help. What we’re trying to do is to be the best in our class, the best digital bank in Brazil. As I mentioned, we have the best cost of funding, the best way to interact with the clients. We combine not only net interest income that comes from the spread on the interest rate, which is a big part of that, but also a lot of fee business, providing a very good service to our clients, either on investment, insurance, shopping and loyalty. That’s the combination that can offset the ups and downs of the rates. It’s been working well so far. I believe that this mindset, it’s really the way to produce alpha at the corporate level, despite of how the country is performing in terms of the GDP growth, interest rate, FX and so on.
Do you see a depreciation trend continuing going forward for the real?
It’s very hard to predict how the FX will behave. So there are a lot of moving factors. We have elections, we have fiscal issues and debt from one country to another. What we see historically is that the US dollar has gained more value against real, for sure. And this is one of the reasons why we’re building this global account concept. So you’re not limited to have your savings, your payment capability only in pesos or only in reals. Why not to have it also in US dollars? Because maybe you’re going to travel to US soon, maybe you’re going to live in US soon. So I can save in US dollars. I can do my reserves in US dollars. I can pay in US dollars. I can receive in US dollars. So this tests the value of the global account. We believe that nowadays people are getting more and more connected with different countries, cultures and currencies. This concept of a global ride share app, Uber, you don’t see that in payments. You don’t see that in retail banking. So that’s the concept of the global account, to help today Brazilians, but who knows down the line, Argentines, Colombians, other countries in Latin America, or even also other countries in Europe. That’s what we’re building, step by step.
There’s a lot of competition from other super apps that have already expanded worldwide, like Revolut. How far behind do you think you are in terms of that competition?
I would say that we’re catching up. It’s important to mention that they are very well focused on building this ecosystem with remittances. At Inter, we started from a different angle, having this robust digital bank franchise with a strong balance sheet, with a credit portfolio Brazil. But as I mentioned, we like to combine credit with services. And we just recently launched the global account initiative that competes with Revolut. We have been able to catch up very fast. And again, having the technology as our backbone is something that has helped us to evolve very fast on the product offering. And I also see that the success of some players in that space helps us to crystallize the vision that we need. We can provide this global payments and finance solutions for millions of clients worldwide. So we are heading in the right direction.
You mentioned geographic expansion to new markets. Another of your competitors, Nubank, entered Argentina in 2019 and left very shortly after. And now twice this year, they’ve mentioned that they’re following things closely there with Javier Milei and are considering a re-entry. Is that a country that you’d be interested in?
Yes, we are interested in this country specifically. We have other countries that are doing assessments. We haven’t decided yet which one and when we’re going to launch. But for sure, Argentina is a country that deserves to be monitored. And one important thing, we are building our expansion in a way that we could eventually launch not only in Argentina, but maybe in multiple countries at once. Because we want to leverage on what we have built in terms of technology. So single sign-in, all the microservices in the payment network and also with the help of local providers. So why not to team up with a player in Argentina? Why not to team up with a player in Colombia, or Mexico? If you really gain a critical mass as we have in Brazil, and also as we’re doing here in the US, you can have your own operation, your own balance sheet in those countries.
Would Portugal and Spain be a logical first step if you looked at the EU?
Yes, when you think about Europe, of course, Portugal and Spain, they are what come up to our mind first. Because I mean, for instance, Portugal, they speak Portuguese and Spain have a lot of connections, a lot of Brazilians. It’s hard, for instance, if you think about Germany, if you think about Eastern Europe. So I’d say that these countries are something that might be a roadmap. They’re not there yet in a roadmap for the future, but I’d say that could be two good options for us.