The fintech saw an increased need for its digital-based services amid the global health crisis.

Neon Pagamentos, a leading Brazilian fintech, has received a Series C investment of $300 million led by General Atlantic. New investors participated in the round, too. These included funds and accounts managed by BlackRock (NYSE: BLK), as well as Vulcan Capital, PayPal Ventures, and Endeavor Catalyst. Existing investors Monashees and Flourish Ventures also took part in the funding, while BBVA participated through existing shareholder Propel Venture Partners. (Contxto)

Neon has so far raised a cumulative amount of $ 420 million in disclosed funding.

The new funding would be received in two tranches of $ 150 million each.

COVID-19

Neon revealed that escalating demand for digital-based services triggered by the COVID 19 pandemic accelerated its “already rapid growth trajectory.”

Deposits, investments, and online purchases surged, while its user base grew by 26% since March.

As of now, it has racked up 9.4 million customer accounts.

The growth in users also came as Neon steadily expanded its services. From a simple digital account offered when it launched in 2016, the company now offers investment products, credit cards, personal loans, and other new services.

Neon has also propelled growth by making strategic acquisitions over the last 12 months.

“Neon was born with a clear purpose: to provide an accessible bank account to any Brazilian, placing user experience at the center of everything we do,” said Pedro Conrade, Founder of Neon. “Unlike banking incumbents in Brazil, we do not transfer the cost of inefficiency to our customers.”

Brazil is known for its extremely high interest rates and limited choices offered by the traditional banking system in the country.

Use of funds

Neon will use the new funds to enhance hiring, release new products and features on the fintech’s consumer platform, boost its technology, and expand its user base across both consumers and enterprise clients. It also plans to roll out new financial services to micro-entrepreneurs, as well as scale its credit offerings.

Neon also said the funding would enable it to pursue strategic M&A opportunities.

According to Contxto,  Neon previously acquired MEI Facil in September 2019 to enhance its strategy to connect with micro-entrepreneurs. In July, it snapped up brokerage firm Magliano Invest as a means to offer investment products to lower-income clientele.

Daniel Mazini, Chief Product Officer at Neon, said the company wanted to offer micro-entrepreneurs a complete pathway, and that it would expand its services to assist the segment in all areas of their business.

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