Financial services are best when they are ubiquitous but not obtrusive – there when you need them, but otherwise, not in the way. This is the goal of Fintech everwhere and embedded financial services. In Brazil, iFood Pago, a digital bank for restaurants, is taking a niche approach by focusing on access to credit, payments, and digital accounts, and today, it reports around R70 billion (about USD $ 12.85 billion) in gross merchandise value per year along with R1.5 billion (about $275 million) in approved lending.
iFood is an online delivery company that has morphed into a Fintech. With over 140,000 active digital accounts in the restaurant sector, it is expanding its portfolio of offerings to provide credit solutions and other banking services.
“Our objective is to assist in financial management inside and outside the salon, supporting establishments so that they have the best results, sell more, reduce their operating costs, by providing credit and generating traffic for online and on-site operations,” says Bruno Henriques, CEO of iFood Pago.
He adds that iFood Pago’s mission is to be a digital food bank focused on serving customers of iFood, which is said to receive 96 million orders per month. This reportedly includes 340,000 restaurants and 30,000 supermarkets. iFood Pago believes it can provide superlative service beyond delivery—in this case, better financial services.
iFood states that it uses empirical data from partner restaurants to understand the best line of credit for each establishment, with information that other market players do not have access to. By leveraging this data it can provide a bespoke solution through solving an important issue for smaller firms and entrepreneurs in need of access to credit.
iFood partners with Zoop on payments. The company also acquired a specialist in onboarding for financial services in Brazil. There is also iFood Benefícios, a multi-benefit card aimed at the corporate benefits and HR market.
iFood Pago has taken existing customers leveraging the touch point to provide new services their customers need while incorporating AI to help decision-making in the credit process.
Pointing to a recent survey, iFood Pago states that 47% of Brazilian SMEs have not tapped into credit products in the last two years, and barriers created by traditional financial institutions make it difficult to get access to capital.
“It is worth highlighting that we are not a traditional machine but a powerful and modern category of this device, which adds data and strategy for our partner. There is nothing like it on the market today”, states Henriques. “In initial tests, we already see restaurants increasing their sales by 7%. We believe that the potential is even greater, as restaurant owners will start to proactively take care of their relationships with their customers.”
