Antitrust Watchdog Investigates Brazil Banks for Restricting Fintech Firms

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Reuters reports that Cade, the antitrust watchdog in Brazil, has launched an investigation into four banks in the country for allegedly creating competition hurdles for a fintech company.

In a statement issued by Cade, digital banking startup Nubank is said to have fallen foul of these hurdles, set out by Banco do Brasil SA, Caixa Economica Federal, Banco Santander Brasil SA and Banco Bradesco SA. The four banks allegedly denied requests for scheduled automatic payments from clients of Nubank who also held accounts at the banks.

Cade did say that the banks would be given a chance to form a defence, before sending the case to Cade’s Administrative Court, which will be responsible to give a final ruling. Nubank said approvingly:

” [we hope] regulatory authorities will continue to protect and stimulate industry competitiveness by ensuring that new entrants will continue to have room to innovate.”

While the other banks have either declined to or yet to provide comment, Banco do Brasil stated that it had given “all the information requested by Cade and remains at its disposal for any further clarification”.

Brazilian banks are no strangers to scandal with crypto and fintech companies. Last year, Banco do Brasil and Santander Brasil were ordered to reopen the accounts of cryptocurrency exchange Bitcoin Max by the Federal District Court. The court termed the unilateral action of banks as abusive conduct that violates customer protection laws and then ordered the banks to re-open the accounts within five days or face up to a BRL 20,000 fine (USD 5,400).

 

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