How Nu Holdings Ltd. Makes Money

Nu Holdings generates revenue through a digital-first financial services platform that serves 114.2 million customers across three Latin American markets. The company's revenue model is built on two primary sources: fees and interest income. In FY2024, fee and commission income contributed approximately 16% of total revenue, primarily from interchange fees on credit and prepaid card transactions — fees paid by merchants when Nubank customers swipe their cards, not directly charged to consumers. Interest income contributed the majority of revenue, derived from interest charged on revolving and refinanced credit card balances, purchases of credit card receivables, personal loans, and interest earned on deposits, government bonds, and other interest-earning instruments. The company's total revenue of $11.5 billion in FY2024 represented a 43.7% year-over-year increase (58% on an FX-neutral basis), with Q4 2024 revenue of $2.99 billion setting a quarterly record. Gross profit was $5.24 billion for FY2024, up 50.5% YoY, with a gross profit margin of 45.6%. Net interest income reached $2.1 billion in Q2 2025, with a net interest margin (NIM) of 17.7% and a risk-adjusted NIM of 9.2%. The company's revenue per customer expands dramatically with tenure: monthly ARPAC was $10.7 in Q4 2024, but customers with over eight years on the platform generated $27.3 in Q2 2025. The average Nubank customer uses 4.1 products, and 30% of Brazilian adults consider Nubank their primary bank. The company's operating model is defined by extreme cost efficiency. Monthly average cost to serve per active customer was $0.80 in Q4 2024 and Q2 2025, compared to $5-15 for traditional banks. The efficiency ratio — calculated as total non-interest operating expenses and transactional costs divided by net interest income plus fees and commissions — improved to 29.9% in Q4 2024, a 610 basis point improvement year-over-year and 150 basis points sequentially. In Q2 2025, the efficiency ratio further improved to 24.7%. This efficiency is driven by the absence of physical branches (the company operates zero branches), cloud-native infrastructure, AI-driven customer service, and automated credit underwriting. The NuX Credit Engine collects more than 30,000 data points per monthly active customer and uses proprietary and alternative data sources to underwrite customers and manage credit risk with a focus on optimizing long-term Net Present Value rather than short-term NPLs. The company's lending portfolio totaled $27.3 billion as of Q2 2025, with the interest-earning portfolio (IEP) at $15.7 billion. Credit card receivables were $14.6 billion in Q4 2024, expanding 28% YoY. The secured lending portfolio grew 615% YoY to $1.4 billion in 2024, representing 23% of total lending, driven by payroll loans and FGTS (Anniversary Withdrawal Loans) where Nubank captured over 30% market share of new originations. Personal loans and Pix financing products also contributed to interest income growth. The company's deposit franchise is a critical funding source and revenue driver. Total deposits reached $28.9 billion in Q4 2024 (up 55% YoY FXN) and $36.6 billion in Q2 2025 (up 41% YoY FXN). The loan-to-deposit ratio was 40% in Q4 2024, indicating significant room for deposit-funded lending growth. In Brazil, deposits reached $23.1 billion in Q4 2024, with funding costs at 89% of blended interbank rates. In Mexico, deposits surged to $4.5 billion in 2024, up 438% from 2023. The company's revenue by geography in FY2024 was heavily concentrated in Brazil: $8.41 billion (73% of total), Mexico $523 million (4.5%), and Colombia $112 million (1%). However, international markets are growing faster: Mexico's customer base expanded 91% YoY and deposits 438% YoY. The company's product portfolio spans five 'financial seasons': spending (credit and prepaid cards, NuPay), saving (Cajitas/Money Boxes, high-yield deposits), investing (NuInvest brokerage, crypto trading), protecting (insurance, NuTravel), and borrowing (personal loans, payroll loans, Pix financing, SME working capital). The Ultravioleta premium product targets high-income customers with exclusive benefits and reached approximately 700,000 customers in 2024, generating $1.8 billion in quarterly purchase volume in Q4 2024. The Marketplace platform had over 1 million customers shopping in 2024, with partnerships including Apple Store exclusive deals and Hopper travel bookings. NuCel, the company's MVNO telecom service launched in partnership with Claro, further diversifies the ecosystem. If the company's credit card interchange fee revenue stream — which depends on purchase volume — were to decline by 20%, Nubank would lose approximately $460 million in annual revenue, given the $125 billion purchase volume in 2024 and typical interchange rates of 1.5-2.0% in Brazil.

Nubank's growth strategy rests on three pillars: expanding its addressable market within existing geographies, increasing revenue per customer through product cross-sell, and proving the Brazil model can be replicated profitably in Mexico and Colombia. In Brazil, where the company had 100 million customers as of early 2025, the incremental opportunity is not new customer acquisition but product depth per customer. Fewer than 20% of Brazilian Nubank customers use more than one product, meaning the path to higher revenue runs through convincing existing customers to adopt the investment platform (NuInvest), insurance products, payroll loans, and the Nu+credit card tier with higher spending limits. The company's strategy is to use AI-driven personalisation — powered by the proprietary Carajas machine learning infrastructure — to serve product offers at the right moment in the customer's financial journey. This approach requires no incremental customer acquisition cost and expands monthly average revenue per active customer, which stood at approximately 1.40 in Q4 2024. In Mexico, Nubank passed 10 million customers in 2024 and is replicating the Brazil playbook: start with a no-fee credit card, build trust, then layer in savings accounts, personal loans, and investments. Mexico's banking penetration rate is significantly lower than Brazil's, and Nubank's digital-first model has a larger addressable market of underbanked consumers than any incumbent. In Colombia, the company is earlier stage but growing rapidly, targeting the same underbanked demographic with the same product sequence. Internationally, Nubank has explicitly ruled out entering high-complexity markets like the United States or Europe in the near term, preferring to deepen penetration in Latin America where its regulatory experience, brand recognition, and operational infrastructure create durable advantages. Capital allocation reflects these priorities: the company is investing in technology and headcount in Mexico and Colombia, maintaining a lean cost structure in Brazil where the business is fully profitable, and exploring additional financial products — particularly insurance and business banking — that could expand the revenue per customer ceiling. The profitability target for 2025 is to expand net income margin while absorbing the investments in international growth, a balance that management believes is achievable given the Brazil segment's strong operating leverage.