- Key insight: Inter&Co now has a license to open a virtual bank branch at its headquarters in Miami.
- What’s at stake: Inter is the latest of several Brazilian digital finance companies to expand in the U.S. in recent months to serve Latin American customers.
- Supporting data: Banco Inter currently has 41 million customers, of which 5 million are in the United States.
A Brazilian digital bank is advancing further into the U.S. market by opening a digital “branch” in the state of Florida.
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Inter&Co, the parent holding company of Brazilian digital bank Banco Inter, announced over the long weekend that it received regulatory approval from the Federal Reserve and the Florida Office of Financial Regulation to establish a state‑licensed international banking branch in Miami.
“Florida is the gate of Latin America,” Inter’s USA country manager, Cássio Segura, told American Banker. “When I came to the U.S., we talked about [reaching] the Latin American [market] through Florida. Being in Florida is the natural localization for us.” Inter&Co previously established its U.S. headquarters in
Inter Chief Operations Officer Ray Tarick Pereira Chalub told American Banker that the bank’s license to operate is anchored to its Miami office, which now serves as a global headquarters for the company. The fully digital nature of the bank, however, allows the branch to operate as a hub for customers across the United States and other areas of the world.
“The state license, in our case of being digital, offers the same capabilities of a national license,” Segura said. “If we were to open branches in other states we would need to request permission, but we don’t have branches so that’s not the case. Digitally, we can collect deposits everywhere with just the state license.”
Inter&Co currently operates in the United States as a nonbank fintech through a subsidiary called Inter. According to the Federal Reserve Board’s approval order, “upon establishment of the Miami Branch, Banco Inter would offer deposit and credit products to both individuals and businesses.”
Under the
A U.S. branch of a foreign bank, however, may not directly obtain FDIC insurance, according to Klaros Group senior director Roman Goldstein.
“The major restriction on a branch of a foreign bank is that it can’t take
An Inter representative confirmed with American Banker that Continental Bank is Inter’s partner for servicing FDIC-insured accounts and cards for U.S. residents.
For non-U.S. residents, deposits are held by the U.S. branch of Banco Inter as a foreign bank organization. Inter’s
“Inter will continue to work with bank partners in the USA, but will increase the participation of processes crucial to funding and customer experience as part of its operations under its own structure,” Chalub said.
Banco Inter was founded in 1994 but transitioned to being one of Brazil’s first digital banks in 2015. It currently has 41 million customers, of which 5 million are in the U.S., and accounts for nearly 10% of P2P payments in Brazil, according to the company.
“The Brazilian Central Bank, our regulator, created the digital banking law in 2015,” Segura said. “There were no digital banks in Brazil before 2015. There were fintechs, but they were payment institutions. For example, Nubank, even though they have the bank in the name, is not a bank in Brazil.”
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