Nubank, the largest financial technology (fintech) firm in Latin America, has opened 1 million savings accounts in Mexico one month after the accounts were made available in the country, the company said Wednesday. 

Total deposits in the accounts total 1 billion pesos (US $58 million).

Some 90% of these deposits are kept in what Nubank calls “little boxes,” a separate space within the accounts where customers can hold funds and receive a 9% annual return. 

The digital bank’s Mexican arm, known as Nu México, opened a waiting list for the opening of the savings accounts in November.  

Nu México previously launched an international credit card with no yearly fee in 2020. By September 2021, the company was the second largest issuer of credit cards in Mexico.

The firm now has a presence in nine out of 10 municipalities in the country and has issued 3.2 million credit cards in Mexico, a country with more than 126 million people.  

Citing low penetration in the credit card market, an analysis by Citi said that the contribution of Nu México operations to the company’s total results might be limited in the short term. According to Citi data, credit card transaction volume in the country amounts only to about 20% of Brazil’s volume.

Despite this pessimism, Nubank is expanding across Latin America, with a planned checking account service scheduled to begin in Colombia. The company is also backed by Warren Buffett’s Berkshire Hathaway investment fund. 

Nubank cofounder Cristina Junqueira said last month that the bank sees growth opportunities in Mexico as “much bigger” than in Brazil. According to World Bank figures from 2021, only about 37% of Mexicans have bank accounts.

Nubank is not the only Latin American fintech firm aiming to win market share in Mexico however.

The Argentinian firm Ualá, which arrived in Mexico in 2020, announced on Wednesday the launch of a high-yield savings account available in the country, ​​after gaining approval from the National Banking and Stock Commission (CNBV) to acquire Mexico’s ABC Capital Bank and expand operations in the country.

With reports from Reuters.