Digital Banking: Nubank Announces Option for Loans, with Investments in Treasury Securities

In another step to expand access to credit and broaden its portfolio, Nubank (NYSE: NU), which claims to be one of the largest digital financial services platforms in the world, announces a new type of loan with investments in Tesouro Direto (treasury Securities) as collateral.

The loan can be taken through Nubank’s app quickly, “without bureaucracy, and with an instant deposit in the user’s account.”

Livia Chanes, General Manager of Nubank Brazil, said:

“We want to sustainably grow our collateralized credit portfolio and diversify the options of investment assets used as collateral. The idea is to offer more efficient solutions for our investor customers while their investments keep yielding.” 

The new option is “available via the Nubank app or the NuInvest platform.”

In this new alternative, the user can “spread the installments over up to 48 months, without having to redeem their investment, with interest rates starting at 1.45%.”

If the customer has “invested in more than one option of federal government bonds and more than one category, the one with the highest value will be automatically used as collateral.”

The user who “chooses this modality will have access to better credit lines, with more competitive rates in the market, besides the security of having a guarantee of payment in case something unexpected happens.”

If an installment is overdue, the guarantee “will be used.” In this case, it will be “executed 20 days after the due date of the unpaid installment, and the investment will be used to cover as many installments as possible, with interest and charges provided for.”

Currently, five categories of Tesouro Direto titles can be “used as collateral for loans: Tesouro Selic, Tesouro IPCA+, Tesouro IPCA+ with semiannual interest, Tesouro Prefixado, and Tesouro Prefixado with semiannual interest.”

Customers have been able “to invest in Tesouro Direto via the Nubank app since February, in addition to the NuInvest platform.”

Collateralized Credit

In November last year, Nubank announced “its debut in the secured lending market, based on investments made in the Planned Redemption function of the Nubank account, in which it is possible to save money for different timeframes.”

In addition, in March this year, the company “announced the expansion of tests for offering payroll loans, NuConsignado.” In this first phase, “a portion of customers in Brazil who are federal public servants are able to hire the service directly through Nubank’s app in a 100% digitalized flow.”

Nubank’s advances in credit collateralization also “include the possibility of increasing the limit of the Roxinho or Ultravioleta credit cards.” This alternative – “named Nu Limite Garantido – makes it possible to use the money saved in Caixinhas (Money Boxes) for an instantaneous limit increase with no bureaucracy.”

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