By Brazil Stock Guide – Nubank S.A. (NYSE: NU | B3: NUBR33) pushed back against the Brazilian Banking Federation (Febraban) after the industry body reignited debate over tax disparities between fintechs and traditional lenders. The digital bank said it was “satisfied” to see Febraban finally acknowledge that fintechs already pay higher effective tax rates, but criticized the entity for making “tortuous arguments” that could harm competition and penalize innovation.
According to Nubank, its operations in Brazil generated a 34.1% effective tax rate, the highest among the country’s major financial institutions. The company argued that its digital-first model has expanded access to financial services, bringing 58% of its customers into the system for the first time—a figure it presents as evidence of fintechs’ role in democratizing credit and lowering borrowing costs.
The statement adds that Nubank has led “a transformation in the sector” through technological innovation, regulatory compliance, and efficiency, while remaining focused on offering “the best products and services” to clients. The bank noted that increased competition has pressured traditional lenders to modernize and cut fees.
The exchange underscores a growing tension between incumbents and newcomers in Brazil’s financial landscape. As Brasília reviews tax reform details, the fight over how to classify fintechs—whether as banks or technology firms—has become central to how billions in revenue will be distributed across the sector.