Paytech PicPay hits 60 million customers in Brazil and wants to be more than a wallet

November 10, 2021
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The main growth arm, going forward, is what the market calls cross selling: the offer of new products and services, in addition to the digital portfolio, the strongest brand in PicPay's DNA

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Six months after reaching 50 million registered users on its platform, PicPay has now hit a new mark: 60 million customers. The growth of more than 50% in the base in just one year is a picture of the turning point that the company promoted over the last few months.

This year was marked by the arrival of new products, in addition to the digital portfolio, and the investment in advertising, which even took PicPay to open TV. The company sponsored this year's edition of Big Brother Brasil and signed a partnership with SBT for a new version of the famous Show do Milhão.

"Part of the growth of a product like ours is linked to the perception of security. Being on TV, in extensive national viewing campaigns, ends up reinforcing the customer's trust in PicPay. It is not a strong strategy, from the point of view of acquisition of new users, but rather to build credibility and trust," said Anderson Chamon, co-founder and vice president of products and technology at PicPay.

Chamon and André Cazotto, investor relations director, spoke exclusively to EXAME In about the numbers for the third quarter and the strategies for next year. The main growth arm, going forward, is what the market calls cross selling: the offer of new products and services, in addition to the digital portfolio, the strongest brand in PicPay's DNA.

"Older customers are joining the new products, and new vintages are already arriving on the platform, contracting a wider range of solutions. This allowed us to diversify our revenues: today, 20% of revenues come from outside the digital portfolio. personal loan, exchange of card operations and the commission we earn at the PicPay Store", says Cazotto.

See the interview with the executives below:

To what do you attribute the 50% jump in the number of customers in 12 months?

Chamon: We've had strong growth over the past three years. We departed from a base of 12 million customers in early 2020, ended last year with 40 million, and have now reached the 60 million user mark. Our goal is to reach 100 million active users in the next three years.

In addition to volume, we also gained in scale. The solution we offer the customer today is better because our portfolio has grown.

What is the role of TV campaigns in this growth?

Chamon: Part of the growth of a product like ours is linked to the perception of safety. Being on TV, in extensive national viewing campaigns, ends up reinforcing the customer's trust in PicPay. It is not a strong strategy, from the point of view of acquiring new users, but rather to generate credibility and trust.

Cazotto: We achieved 90% brand awareness, we are the most recognized digital portfolio in the country, far ahead of competitors such as Iti [from Itaú], Mercado Pago and PayPal, for example. We managed to outperform players with more time in the market because of this important brand building.

What was the strategy to bring more products onto the platform, in addition to the digital wallet solutions?

Chamon: Our main value proposition is day-to-day payments. PicPay exists to replace cash and card, in the long run. With that in mind, we started to offer other products as well. Cross selling is easier when the user has strong recurrence of usage, as our customers do, and when average spending is higher. We were able to increase this user spending on the platform by 80%.

Cazotto: The cards front was important in this strategy. We have already issued 10 million multiple cards, most with active debit and credit functions. We have a product that is a physical and virtual card, which makes online purchases easier.

Older customers are joining the new products, and new vintages are already arriving on the platform hiring a wider range of solutions. This allowed us to diversify our revenues: today, 20% of revenues come from outside the digital portfolio. These are income from personal loans, exchange of card transactions and the commission we earn at PicPay Store.

Within that 20%, which are the most relevant products and services?

Cazotto: Most of it comes from three pillars: personal loan, PicPay card and the financial marketplace, which encompasses the commission we earn at the PicPay Store, the service we offer retailers who want to create gadgets, and our acquiring business.

As we create possibilities within the platform, we naturally transform the customer into an active customer, and ultimately into a transactional customer. Today we have 28 million active users and 18 million users who frequently transact on the platform.

Which cross selling front should gain more strength in the coming months?

Chamon: We're expanding some products, like peer-to-peer lending through the app. We started with a pilot, and now we're expanding to more users. We also want to expand our credit area beyond personal loans, offering working capital to corporate clients, especially small and medium-sized companies. As we are a platform that integrates other services, we have infinite possibilities for cross selling new products.

PicPay has adopted very aggressive investment campaigns, offering, at any given time, returns of up to 200% of the CDI for the money invested in the accounts on the platforms. How is this account balance acquisition strategy?

Chamon: The campaign had as its main objective to get people to bring their money to PicPay, and it worked really well. We managed to exceed a volume of 5 billion reais in the portfolio, delivering to our users a yield above the market average. Therefore, we intend to continue with this strategy.

Cazotto: We have a strong inflow of funds, despite having adjusted the remuneration from 200% of the CDI to 120% of the CDI, currently. The balance in the accounts grew more than ten times, year after year, and the number of users with balance in the wallet more than tripled.

Three months ago, PicPay bought fintech Guiabolso. How has the integration process of the two companies been?

Chamon: I would say better than expected. We managed to absorb one of Guiabolso's main values, which is the use and analysis of data to deliver greater value to our users. This has everything to do with Open Banking, which is advancing in Brazil.

Cazotto: It's important to remember that PicPay was the pioneer in instant payments, which gave us a lot of experience to embrace Pix, and Guiabolso was a pioneer in using and analyzing information in the way that Open Banking is only now proposing.

In addition, Guiabolso already had a well-established financial marketplace, which matches our strategy of being an open platform for distributing third-party products. We must integrate Guiabolso's partners to our marketplace. We also want to bring Guiabolso's account aggregator product to our ecosystem, to help PF clients manage their finances, costs and expenses.

Is a PicPay IPO still in the plans?

Cazotto: Going public is still part of the plans, but it's not on the radar right now. The contribution we received from J&F allows the company to continue expanding its business model, bringing in new partners and diversifying the portfolio.

Do plans point to an IPO abroad or in Brazil?

Cazotto: Naturally, our idea is to access the market abroad. I was the IR director at PagSeguro, and participated in the company's IPO process at Nasdaq, in the United States. For me, it makes sense for high-growth technology companies like PicPay to access the capital markets abroad, because the investor there has more experience in dealing with this type of business.

Las opiniones compartidas y expresadas por los analistas son libres e independientes, y de ellas son responsables sus autores. No reflejan ni comprometen el pensamiento u opinión de Latam Fintech Hub, por lo cual no pueden ser interpretadas como recomendaciones emitidas por la platafomra. Esta plataforma es un espacio abierto para promover la diversidad de puntos de vista sobre el ecosistema Fintech.

Six months after reaching 50 million registered users on its platform, PicPay has now hit a new mark: 60 million customers. The growth of more than 50% in the base in just one year is a picture of the turning point that the company promoted over the last few months.

This year was marked by the arrival of new products, in addition to the digital portfolio, and the investment in advertising, which even took PicPay to open TV. The company sponsored this year's edition of Big Brother Brasil and signed a partnership with SBT for a new version of the famous Show do Milhão.

"Part of the growth of a product like ours is linked to the perception of security. Being on TV, in extensive national viewing campaigns, ends up reinforcing the customer's trust in PicPay. It is not a strong strategy, from the point of view of acquisition of new users, but rather to build credibility and trust," said Anderson Chamon, co-founder and vice president of products and technology at PicPay.

Chamon and André Cazotto, investor relations director, spoke exclusively to EXAME In about the numbers for the third quarter and the strategies for next year. The main growth arm, going forward, is what the market calls cross selling: the offer of new products and services, in addition to the digital portfolio, the strongest brand in PicPay's DNA.

"Older customers are joining the new products, and new vintages are already arriving on the platform, contracting a wider range of solutions. This allowed us to diversify our revenues: today, 20% of revenues come from outside the digital portfolio. personal loan, exchange of card operations and the commission we earn at the PicPay Store", says Cazotto.

See the interview with the executives below:

To what do you attribute the 50% jump in the number of customers in 12 months?

Chamon: We've had strong growth over the past three years. We departed from a base of 12 million customers in early 2020, ended last year with 40 million, and have now reached the 60 million user mark. Our goal is to reach 100 million active users in the next three years.

In addition to volume, we also gained in scale. The solution we offer the customer today is better because our portfolio has grown.

What is the role of TV campaigns in this growth?

Chamon: Part of the growth of a product like ours is linked to the perception of safety. Being on TV, in extensive national viewing campaigns, ends up reinforcing the customer's trust in PicPay. It is not a strong strategy, from the point of view of acquiring new users, but rather to generate credibility and trust.

Cazotto: We achieved 90% brand awareness, we are the most recognized digital portfolio in the country, far ahead of competitors such as Iti [from Itaú], Mercado Pago and PayPal, for example. We managed to outperform players with more time in the market because of this important brand building.

What was the strategy to bring more products onto the platform, in addition to the digital wallet solutions?

Chamon: Our main value proposition is day-to-day payments. PicPay exists to replace cash and card, in the long run. With that in mind, we started to offer other products as well. Cross selling is easier when the user has strong recurrence of usage, as our customers do, and when average spending is higher. We were able to increase this user spending on the platform by 80%.

Cazotto: The cards front was important in this strategy. We have already issued 10 million multiple cards, most with active debit and credit functions. We have a product that is a physical and virtual card, which makes online purchases easier.

Older customers are joining the new products, and new vintages are already arriving on the platform hiring a wider range of solutions. This allowed us to diversify our revenues: today, 20% of revenues come from outside the digital portfolio. These are income from personal loans, exchange of card transactions and the commission we earn at PicPay Store.

Within that 20%, which are the most relevant products and services?

Cazotto: Most of it comes from three pillars: personal loan, PicPay card and the financial marketplace, which encompasses the commission we earn at the PicPay Store, the service we offer retailers who want to create gadgets, and our acquiring business.

As we create possibilities within the platform, we naturally transform the customer into an active customer, and ultimately into a transactional customer. Today we have 28 million active users and 18 million users who frequently transact on the platform.

Which cross selling front should gain more strength in the coming months?

Chamon: We're expanding some products, like peer-to-peer lending through the app. We started with a pilot, and now we're expanding to more users. We also want to expand our credit area beyond personal loans, offering working capital to corporate clients, especially small and medium-sized companies. As we are a platform that integrates other services, we have infinite possibilities for cross selling new products.

PicPay has adopted very aggressive investment campaigns, offering, at any given time, returns of up to 200% of the CDI for the money invested in the accounts on the platforms. How is this account balance acquisition strategy?

Chamon: The campaign had as its main objective to get people to bring their money to PicPay, and it worked really well. We managed to exceed a volume of 5 billion reais in the portfolio, delivering to our users a yield above the market average. Therefore, we intend to continue with this strategy.

Cazotto: We have a strong inflow of funds, despite having adjusted the remuneration from 200% of the CDI to 120% of the CDI, currently. The balance in the accounts grew more than ten times, year after year, and the number of users with balance in the wallet more than tripled.

Three months ago, PicPay bought fintech Guiabolso. How has the integration process of the two companies been?

Chamon: I would say better than expected. We managed to absorb one of Guiabolso's main values, which is the use and analysis of data to deliver greater value to our users. This has everything to do with Open Banking, which is advancing in Brazil.

Cazotto: It's important to remember that PicPay was the pioneer in instant payments, which gave us a lot of experience to embrace Pix, and Guiabolso was a pioneer in using and analyzing information in the way that Open Banking is only now proposing.

In addition, Guiabolso already had a well-established financial marketplace, which matches our strategy of being an open platform for distributing third-party products. We must integrate Guiabolso's partners to our marketplace. We also want to bring Guiabolso's account aggregator product to our ecosystem, to help PF clients manage their finances, costs and expenses.

Is a PicPay IPO still in the plans?

Cazotto: Going public is still part of the plans, but it's not on the radar right now. The contribution we received from J&F allows the company to continue expanding its business model, bringing in new partners and diversifying the portfolio.

Do plans point to an IPO abroad or in Brazil?

Cazotto: Naturally, our idea is to access the market abroad. I was the IR director at PagSeguro, and participated in the company's IPO process at Nasdaq, in the United States. For me, it makes sense for high-growth technology companies like PicPay to access the capital markets abroad, because the investor there has more experience in dealing with this type of business.

Las opiniones compartidas y expresadas por los analistas son libres e independientes, y solamente sus autores son responsables de ellas. No reflejan ni comprometen el pensamiento o la opinión del equipo de Latam Fintech Hub y, por lo tanto, no pueden interpretarse como recomendaciones emitidas por la plataforma. Esta plataforma es un espacio abierto para promover la diversidad de puntos de vista en el ecosistema Fintech.
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