Building a FinTech Company in Brazil: Sergio Furio, CEO of BankFacil (Part 6)

Sramana Mitra: Your core business model is the origination fee business model?

Sergio Furio: We call ourselves an originator of secure loans. That’s where our value add is. If you think about it, a collateralized loan is very complex to originate. If you can create a business that excels in processing the loans for home equity and auto equity, then you have found a good spot.

Everyone loves those types of credit. The volatility of that credit is very low because you have the collateral. Then the investors definitely want to invest in that type of loans. The complexity is building a platform that originates these types of loans with high quality in an efficient way.

Sramana Mitra: How many financial institutions do you work with in this mode? How many financial institutions are sourcing these loans from you?

Sergio Furio: Today, we are working with 14 financial institutions and investors.

Sramana Mitra: Are there any metrics you want to provide in terms of number of loans or total volume of loans that you have processed?

Sergio Furio: We had originated $100 million in loans. We have not provided an update of that figure, which was published a year ago. We are growing the business rapidly. Hopefully, soon we will provide some more color on our growth. We are a team of 110 people. Last year, we grew from 45 to a team of 110. We are currently closing our Series B.

Sramana Mitra: Very interesting. Your growth plan is focused on Brazil or are you planning to expand to other parts in Latin America?

Sergio Furio: The thing about financial services and specifically on lending is that’s it’s a regulated environment. It’s local regulation. Your appetite for moving from one country to another is not that big. For the moment, we have no interest in geographical expansion and want to focus on just becoming the market leader in Brazil. Once we achieve that, we could think about moving into other markets.

I would say that our expansion is more into educating the consumer that is not familiar with this category. In the US, everyone knows that they can take a home equity loan. There’s nothing like that in Brazil. We are creating a new product category. Our expansion plans involves locating the consumer and then creating a specific product for a specific need. For example, you have a home equity loan for home improvement. It’s about creating specific niche products using the same platform.

Sramana Mitra: It sounds like there is plenty of growth potential in the Brazilian market for you to build a considerably large company based in this business model.

Sergio Furio: The Brazilian model is half a trillion dollars in outstanding debt in consumers. We are targeting, in the long term, something in the range of $100 billion in annual origination. We have plenty of room for growth in this specific product in Brazil.

Sramana Mitra: Very good. It was a pleasure listening to your story. Good luck with everything.

This segment is part 6 in the series : Building a FinTech Company in Brazil: Sergio Furio, CEO of BankFacil
1 2 3 4 5 6