According to a press release issued on Monday, Spain’s BBVA bank increased its position in digital bank Neon with a $300 million (€263 million) investment, giving the traditional financial institution a 21.7 percent holding in the Brazilian startup (Feb. 14).
The new agreement is expected to close before the end of February, according to BBVA. Since 2018, BBVA has owned an interest in Neon through its venture capital fund Propel. Following the completion of this new investment arrangement, BBVA will own 29.7% of Neon.
Neon, based in So Paulo, Brazil, was created in 2016 and serves 15 million registered accounts in Brazil, including individuals, self-employed people, and small enterprises. The digital bank provides small businesses with free checking accounts, debit and credit cards, payroll loans, and speciality products.
Purchasing a larger interest in Neon is in line with BBVA’s strategy of investing in digital platforms to grow into new markets. Brazil is particularly appealing, according to the corporation, because of its enormous economy and population of more than 210 million people.
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