Brazilian fintech Neon finds new banking partner, rushes to restablish operations

The startup, hurt by the liquidation of the bank supporting its operations, settles partnership with another institution.
Written by Angelica Mari, Contributing Writer

Following the liquidation of the bank supporting the operations of Brazil-based digital bank Neon, the fintech has found a new partner.

In order to function, Neon operated in partnership with a bank handling its settlements, which was shut down by Brazil's central bank on Friday.

Neon then scrambled to find a new partner as customers rushed to withdraw their cash and lost confidence in the fintech, which suffered with its systems unstable or just entirely unavailable.

Today (7) it announced a partnership with Banco Votorantim, the seventh largest bank in Brazil, controlled by Votorantim Group, one of Latin America's largest private-sector conglomerates and Banco do Brasil, one of the country's largest banks.

The agreement has the full recovery of Neon's activities as its main goal as quickly as possible - however, the firms haven't provided a specific timescale for that to happen.

Neon plans to grow its customer base from 600,000 clients to 1 million in 2018 and raised $22 million in venture capital last week to support that objective.

As well as continuing to bring in more business to satisfy its backers, the Brazilian firm will clearly have to work even harder to repair the damage caused to the confidence of its existing customers after last week's events.

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