Nubank launches US high-yield savings account, credit cards, remittances

Brazilian digital bank Nubank plans to expand its services to the United States, launching high-yield savings accounts, credit cards, and remittance services through partnerships with local banks. CEO David Velez and co-founder Cristina Junqueira announced the move during an event in Miami. Nubank will partner with FDIC-insured Lead Bank to offer deposit accounts with a 3.50% yield, free international money transfers, and a no-fee credit card with 1.5% cashback.

The bank's charter with the Office of the Comptroller of the Currency (OCC) was conditionally approved in January, and it is now undergoing review by the Federal Reserve and FDIC. Junqueira expects the bank to begin operations in the United States next year, operating through a partner-bank model until then. Nubank's shares rose following the news and were up 1.6% at the time of reporting.

The shares have declined 9% so far in 2022. The company plans to introduce digital asset trading, including Bitcoin and Ethereum, and other products such as investments, insurance, and small business accounts in the future. Nubank aims to target young customers and the U.S. Hispanic population, which is more familiar with the brand.

Organic growth is the primary strategy, although Velez mentioned potential opportunities to accelerate growth through acquisitions. It will take several years for the U.S. operation to become profitable, similar to Nubank's experience in Brazil, where it took eight years to become profitable.