Nu Holdings in 2028: Banking Disruptor or Just Another Fintech Flameout?

Latin America's digital banking darling faces its make-or-break moment.

The Brazilian neobank stormed markets with its 2021 IPO - now the real test begins. Can Nu Holdings outmaneuver incumbents and sustain hypergrowth without burning through cash like a crypto startup at a Miami yacht party?

Customer acquisition: The land grab phase is over. With 90+ million users already onboard, Nu must now prove it can actually monetize this base beyond basic accounts. Cross-selling investment products and loans will separate disruptors from also-rans.

Regulatory gauntlet: As central banks tighten oversight, Nu's asset-light advantage could become a liability. Those sweet interchange fees? Suddenly negotiable when politicians smell 'excessive profits.'

International chess match: Mexico and Colombia look ripe for conquest, but local rivals won't surrender without a fight. Nu's tech stack better travel well - and its war chest better run deep.

Three years from now, we'll either hail Nu as the region's first true digital banking champion... or another cautionary tale about fintechs that confused viral growth with sustainable economics. Place your bets - the house always wins.

Image source: Getty Images.

Nu is making all the right moves

Nu isn't exactly a household name in the U.S., given that it's based in Brazil and operates primarily in that country, as well as Colombia and Mexico. But just because it flies under the radar in the U.S. doesn't mean Nu doesn't have enormous reach. Consider these recent results from Nu's 2025 first quarter:

• Customer growth increased by 19% to 109 million globally
• Revenue rose 40% to $3.2 billion
• Earnings spiked 33% to $0.12 per share
• Monthly average revenue per active customer (ARPAC) rose by 17%
• 80% of its users actively use its app on a monthly basis

Those are all impressive results, and they show just how well the company is growing right now, even amid the backdrop of rising interest rates in Brazil.

Like many other fintech companies, one of the keys to Nu's success has come from offering an expanding list of financial services to its customers. For example, Nu operates as a bank in Brazil but also offers credit cards, personal and small business loans, crypto trading, and e-commerce services through its app.

To put into perspective just how popular Nu's financial app is, the company said that 57% of Brazil's adult population uses the company's services. That's a heck of a lot of market share, and it's even more impressive considering that Nu launched its very first product just 11 years ago.

Why Nu could see more growth over the next three years

Even with Nu's impressive past growth in Brazil, there are some good indicators that the company's expansion will continue, thanks to its focus on Mexico.

Nu already offers some financial services in Mexico, and the company recently received its bank license in the country, which allows it to offer even more options to customers. The company has already added 12 million customers in Mexico in the short time it has operated there, outpacing its early growth in Brazil.

An estimated 45% of Mexico's population doesn't have a bank account, which gives Nu a massive opportunity to add to its already large user base of more than 109 million customers.

Nu has plenty of room to continue expanding its services across Brazil and Colombia as well. An estimated 26% of the Latin American adult population is unbanked, giving Nu an opportunity to continue tapping into this market.

Why now could be a good time to buy Nu stock

Nu's stock has been relatively flat over the past year, as investors have tried to gauge the effect of macroeconomic trends in Brazil, Mexico, and Colombia. Their concern has likely been whether or not Nu will be able to expand in a tougher economic environment.

While that's a legitimate consideration, it appears that the market may be treating Nu's stock too harshly. Over the next few years, Nu will most likely continue attracting more customers across Brazil and rapidly adding new ones in Mexico with its new banking services. Considering that so many adults are still unbanked in many Latin American countries, it's only a matter of time before they find their way to the types of fintech services Nu offers.

With Nu's stock currently having a price-to-earnings (P/E) multiple of 29, compared to the average financial services sector P/E ratio of 30, the company's shares are attractively priced right now.