NextBillion - An Initiative of the William Davidson Institute at the University of Michigan

By Mary Ann Azevedo

For decades, Brazil has had a huge credit problem. It is Latin America’s largest country and has one of the highest interest rate spreads in the world.

To give you an idea of just how bad it is, reports indicated that in 2019, credit card interest rates neared a staggering 300% in Brazil.

This is one of the reasons you’re seeing so many fintechs emerge in Latin America. Interest rates this high make it very difficult for the economically challenged to ever not be economically challenged. In another example of how startups in the region are working to boost inclusion as much as innovation, Open Co, a São Paulo-based consumer credit company, announced today that it has raised $115 million in a round led by SoftBank Latin America Fund.

Photo courtesy of Tima Miroshnichenko from Pexels.