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Is ‘beyond banking’ becoming a new trend among fintechs and banks in Latin America?

Can a retail bank offer a motorcycle to its clients? Might a fintech sell furniture or tennis shoes while providing financing? Can they get the latest iPhone to their customers days after its launch or even arrange house repairs through the company’s app? 

With “beyond banking,” some believe the cases like these — where a financial company offers a non-financial service — will become increasingly common in the industry.

Amid the pandemic, online marketplaces in Latin America have grown massively in size, a region that had traditionally lagged behind other parts of the world before Covid-19. More than two years later, customers shopping online have grown by millions, and financial service companies have figured out a way into e-commerce.

Recently, Itau, the largest bank in Brazil and Latin America, announced it would offer online shopping services through its digital application. The banking behemoth partnered with Magazine Luiza, one of the largest retail stores in the country, to display items for sale on Itau Shop, its marketplace. 

Installments and loyalty points

Purchases can be divided into 12 interest-free installments, and customers will earn loyalty points. The bank has a sizeable audience: roughly 70 million clients could be potentially exposed to the store.

Per the agreement, the bank earns a fee per sale. In the long run, however, there is even greater potential as Itau gathers consumer behavior data to identify new opportunities to cross-sell with its vast array of financial services. 

Firmer competition from neobanks in Brazil pushes the traditional banking sector to innovate. By launching the marketplace, Itau joins a group of Brazilian financial institutions that have created virtual malls for their customers. Banco do Brasil, another big-sized bank in the country, has also launched an initiative along those lines.

To be sure, banks are mirroring strategies in some cases already being approached by fintechs, such as digital bank Nubank or fintech unicorn lender Creditas. The online lender launched its virtual shop by the end of 2021, while Creditas offers its clients the possibility of getting a new iPhone while it deducts installments from their payroll.

Luis Santa Creu headshot
Luis Santa Creu

“It is a protective measure. It seems like an attempt of big banks to resemble the language and style of fintechs,” said Luis Santa Creu, a bank analyst in Sao Paulo. “With open banking, many participants from outside the banking sector will be able to participate in the financial architecture. This is a concern that banks have.”

Avoid losing customers

According to him, beyond banking is a way for banks to converge towards fintech models and avoid losing customers in the long run, especially considering the risk of big tech companies like Facebook or Google offering banking services.

Faced with the threat of non-financial companies, both banks and fintechs have expanded their portfolio amid the increased digitization of these economies.


Essentially, the term “beyond banking” refers to financial companies offering services that are not strictly financial. Some argue it could have a powerful impact on the banking sector.

Banks think of this as a way to increase engagement, reinforce the ecosystem and potentially cross-sell.

“Beyond banking is an essential strategy to escape the commoditization of financial services in the market,” said Bruno Diniz, a fintech advisor and book author. “Companies can gain greater customer knowledge and provide more services to the user, whether proprietary or third-based.” 

Beyond Brazil

To be sure, the trend is not only Brazil-based. According to a report by BNP Paribas, open banking regulation allows the banking industry to develop new value propositions in ecosystems that go beyond its traditional offerings.

“We are developing more and more extra-financial services while remaining mobilized for our core business,” Sarah Janin, a Retail Transformation manager at the bank, wrote in the report. “We are doing so for two reasons: our customers’ consumption behavior is evolving. Besides, we must stand out from our competitors, especially neobanks.”

  • David Feliba

    David is a Latin American journalist. He reports regularly on the region for global news organizations such as The Washington Post, The New York Times, The Financial Times, and Americas Quarterly.

    He has worked for S&P Global Market Intelligence as a LatAm financial reporter and has built expertise on fintech and market trends in the region.

    He lives in Buenos Aires.