Brazil's financial and technological leadership. The results of a 5-year revolution in the banking sector

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Abstract

5 years ago Brazil was a country with an extremely monopolized structure of the banking sector. The existing problems in the banking sector (limited operations without physical presence, the inaccessibility of bank branches to the population from remote areas of the country), combined with the spread of the Internet and smartphones and the accelerated penetration of digital technologies during the pandemic, contributed to breakthrough development of FinTech companies offering affordable and simple digital financial and investment services. Brazil has become a country of FinTech leadership both in Latin America and in the world – it has reached a share of 15% of global online transactions and ranks 2nd in the world after South Korea in terms of the number of mobile transactions per capita, and 2 times more mobile fast payments are made here daily than in India, with the difference in population more than a billion people. The article analyzes the prerequisites of the Brazilian FinTech revolution and the dynamics of the FinTech industry and assesses the limitations and prospects for development, taking into account the significant role of the state in the digital transformation in the country and the stimulation of private business in the financial sector, the creation of digital banking ecosystems and the support of healthy market competition.

About the authors

Igor M. Stepnov

Financial University under the Government of the Russian Federation

Email: stepnoff@inbox.ru
ORCID iD: 0000-0003-4107-6397
Doctor of Economics, Professor at Department of Corporate Finance and Corporate Governance Leningradsky Prospekt 49/2, 125167 Moscow, Russian Federation

Julia A. Kovalchuk

Market Economy Institute Russian Academy of Sciences

Email: fm-science@inbox.ru
ORCID iD: 0000-0002-9959-3090
Doctor of Economics, Professor, Leading Researcher Nakhimovsky Prospekt 47, 117418 Moscow, Russian Federation

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