Inter Is Making Banking Simpler For Brazilian And Latinx Immigrants

(MENAFN- News Direct)

Belo Horizonte, MG | January 18, 2023 08:15 AM Eastern Standard Time

By Faith Ashmore, Benzinga

For millions of Americans, accessibility to banking institutions is a given, but for many underserved communities, banking is not as accessible and its lack can negatively impact financial prospects. As such, underbanked communities are often relegated to the margins where they must rely on nontraditional financial institutions like check cashers and payday lenders.

Families that rely on nontraditional financial institutions are often at the whims of predatory practices. Check-cashing outlets can cost anywhere from 1% to 12% of the value of the check. Depending on cash or money orders to pay for essentials can cost valuable time and resources; if you have to go to the post office to purchase a money order to pay for rent, that is far more time-consuming than paying online with a debit card. People who go to a payday lender instead of a bank for a loan can end up paying over 300% interest and nearly 1% in four payday loans are reborrowed nine times or more.

Marginalized communities and immigrants are underbanked at higher rates than their white counterparts. in 2019 , 12.2% of Hispanic households and 13.8% of Black households were underbanked compared to 2.5% of white ones. The disparity exists for a number of reasons ranging from distrust of financial institutions to language barriers to systemic barriers like hefty ID requirements and high minimum balances.

For underbanked communities, there is a draw to nontraditional financial institutions and a need for those institutions to empower.

Inter Is A Nontraditional Financial Institution With A Focus On Inclusivity

Inter&Co (NASDAQ: INTR) understands the importance of expanding financial options and accessibility to underbanked communities. Inter was the first 100% digital Brazilian bank that provided a free digital checking account. In Brazil, Inter has expanded that legacy to include a complete range of services in banking, investments, credit, insurance, and cross-border services.

in january 2022, inter acquired the u.s. fintech company usend. USEND had a client base of over 150,000 U.S.-based customers across 40 states and offered both financial and non-financial services to its clients. This acquisition enabled Inter's U.S. customers to make transfers in U.S. dollars quickly and 100% online. The platform also allows payment processing from several international platforms with ACH/wire transfers to any account in the US.

After this acquisition, the company integrated USEND's offerings into the Inter Super App, bringing its benefits to both U.S. and Brazilian customers, and renamed it to Inter Global The Global Account allows customers to buy airfare, transfer US dollars to an international account, and pay expenses during an international trip, all in a single app. At the end of September, there were more than 500,000 Brazilian Global Account users on the platform. Inter's Global Account does not have an opening or monthly fee, making banking more accessible to underbanked communities.

inter is also working to expand services for its customers and recently announced they have become a certified provider with Amazon. Now Inter's Brazilian clients who are sellers on Amazon will be able to receive and send payments directly to their Inter accounts.

The company is actively working to build ties and accountability within immigrant communities in New York City. In November, inter announced that it became an official new partner of the New York City Football Club (NYCFC). The NYCFC has a strong immigrant and Brazilian fan base and Inter is eager to provide its services to Latino communities.

priscila salles, cmo of inter&co, shared: 'We are very excited to partner with the NYCFC, not only for what they represent as one of the leading MLS teams but also as a way to connect more meaningfully with the Brazilian and Latino communities in the US. Our commitment to making money remittances affordable and accessible to everyone resonates deeply with NYCFC values of inclusion and community.'

For underbanked communities, having access to nontraditional financial institutions like Inter can help make life easier by opening doors and providing a safety net against often-predatory financial services like payday loans.

This article was originally published on Benzinga here .

Inter&Co is the holding company of Inter Group and indirectly holds all of Banco Inter's shares. Inter is a digital bank that simplifies people's lives, where everything is integrated in a single app. In Brazil, under the Inter brand, the company offers a complete suite of services in banking, investments, credit and insurance, in addition to a virtual mall that brings together the best retailers in Brazil and the US. The company's US digital account, under the Inter Global brand, allows individuals and companies to make transfers in U.S. dollars quickly, safely and 100% online, as well as process payments from several international platforms. It also offers debit cards, gift cards with cashback, and ACH/Wire transfers to any account in the US, serving as a hub for the needs its customers have in a world without borders. Inter&Co is listed on Nasdaq under the ticker INTR.

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This material may contain forward-looking statements regarding Inter, anticipated synergies, growth plans, projected results and future strategies. While these forward-looking statements reflect our Management's good faith beliefs, they involve known and unknown risks and uncertainties that could cause the company's results or accrued results to differ materially from those anticipated and discussed herein. These statements are not guarantees of future performance. These risks and uncertainties include, but are not limited to, our ability to realize the amount of projected synergies and the projected schedule, in addition to economic, competitive, governmental and technological factors affecting the Bank, the markets, products and prices and other factors. In addition, this presentation contains managerial numbers that may differ from those presented in our financial statements. The calculation methodology for these managerial numbers is presented in Inter's quarterly earnings release. Statements contained in this report that are not facts or historical information may be forward-looking statements under the terms of the Private Securities Litigation Reform Act of 1995. These forwardlooking statements may, among other things, beliefs related to the creation of value and any other statements regarding Inter. In some cases, terms such as“estimate”,“project”,“predict”,“plan”,“believe”,“can”,“expectation”,“anticipate”,“intend”,“aimed”,“potential”,“may”,“will/shall” and similar terms, or the negative of these expressions, may identify forward looking statements. These forward-looking statements are based on Inter's expectations and beliefs about future events and involve risks and uncertainties that could cause actual results to differ materially from current ones. Any forward-looking statement made by us in this document is based only on information currently available to us and speaks only as of the date on which it is made. We undertake no obligation to publicly update any forward-looking statement, whether written or oral, that may be made from time to time, whether as a result of new information, future developments or otherwise. For additional information that about factors that may lead to results that are different from our estimates, please refer to sections“Cautionary Statement Concerning Forward-Looking Statements” and“Risk Factors” of Inter&Co Annual Report on Form 20-F. The numbers for our key metrics (Unit Economics), which include active users , average revenue per active user (ARPAC), cost to serve per active cliente (CTSAC) and cross selling index (CSI), are calculated using Inter's internal data. Whether based on what we believe to be reasonable estimates, there are challenges inherent in measuring the use of our products. In addition, we continually seek to improve estimates of our user base, which may change due to improvements or changes in methodology, in processes for calculating these metrics and, from time to time, we may discover inaccuracies and make adjustments to improve accuracy, including adjustments that may result in recalculating our historical metrics. The financial information, unless otherwise stated, is presented in millions of reais, in accordance with the consolidated financial statements, in IFRS.


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