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Fintech and Brazil’s small business market

by Ray Hayes

Fintech firms are aggressively moving into Brazil’s small business market after the exit of many larger lenders with consumer lending and credit card industry seeing the most growth. According to Jorge Vargas Neto, founding partner of Biva, “There’s a lot of room to grow because banks still charge very high rates and availability of credit for small- and mid-sized enterprises remains restricted.”

Many reports indicate that borrowers in Brazil are paying on average 250 percent a year for rollover credit which is by far the highest among the world’s largest economies. Furthermore, another main concern in  Latin America’s biggest country is the lack of regulation, in particular between peer to peer lenders. In order to alleviate some of these problems, Fintech organizations are trying a variety of ways to push investors to fund smaller businesses. As of now, Brazil is home to more than 230 of the 703 Latin America Fintechs.


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