Bradesco launches digital bank, facing down Brazil fintechs (updated)

Banco Bradesco

30/10/2017 17:05

(Adds stock price in paragraph 5) 
    By Aluisio Alves 
    SAO PAULO, Oct 30 (Reuters) - Brazil's Banco Bradesco SA 
 BBDC4.SA  will unveil an all-digital bank this week called 
Next, marking the biggest effort by a major bank in Latin 
America's top economy to take on the country's burgeoning 
financial technology startups. 
    Targeting tech-savvy Brazilians aged 18 to 34, Bradesco is 
partnering with Apple Inc  AAPL.O , Uber Technologies Inc 
 UBER.UL  and Microsoft Corp's  MSFT.O  Xbox to offer perks on 
accounts that cost 20 reais to 40 reais ($6-12) per month. 
    The digital, or strictly online, bank is just the latest 
example of how big Brazilian banks are being forced to innovate 
and cut costs as they confront the threat of fast-growing 
fintechs.  
    In an interview, Mauricio Minas, Bradesco's vice president 
of technology, said that by offering online banking and other 
services, Next can offer lower lending rates than those charged 
at its brick-and- mortar branches.  
    Still, Minas ruled out fighting financial technology rivals 
by scrapping fees or offering the lowest possible interest 
rates. 
    "Those who have very low interest rates do not sustain 
themselves over time," said Minas. "Next will not be irrational 
with fees." 
    Bradesco's preferred shares were down nearly 2 percent, in 
line with other Brazilian lenders. 
    The new venture's performance could help determine Minas' 
prospects in the race to succeed Bradesco Chief Executive 
Officer Luiz Carlos Trabuco, who recently succeeded Lazaro 
Brandão as chairman. Trabuco is set to relinquish the CEO post 
in March.  urn:newsml:reuters.com:*:nL2N1MM19B 
    The Next launch is the latest sign of ferment in the 
Brazilian financial technology market. Foreign firms have made 
investments in recent weeks ahead of an expected move by the 
Brazilian central bank to implement new rules for the sector. 
    Last week, Brazilian startup Nubank said it would expand 
from credit cards into online accounts that allow users to make 
transfers, pay bills and earn higher interest rates than on an 
average savings account.  urn:newsml:reuters.com:*:nL2N1MZ18G 
  ($1 = 3.24 reais) 
 
 (Reporting by Aluisio Alves; Writing by Alexandra Alper; 
Editing by Christian Plumb and Jeffrey Benkoe) 
 ((Alexandra.Alper@thomsonreuters.com; 021-98186-5429; Reuters 
Messaging: alexandra.alper.thomsonreuters.com@reuters.net)) 
 
Keywords: BANCO BRADESCO NEXT/