With the technological and regulatory advancements in the Brazilian financial market, driven primarily by the incentives from the Central Bank of Brazil and the Brazilian Securities and Exchange Commission (CVM) in recent years (such as the creation of Payment Institutions and Direct Credit Companies, along with the implementation of PIX and Open Finance), industry participants have identified an opportunity to facilitate the entry of new players into the banking sector. In this context, Banking as a Service (BaaS) has emerged as a solution that allows companies from various sectors, such as clothing stores and supermarkets, to offer financial services to their customers without needing to develop their own technological infrastructure.

BaaS, or “Banking as a Service,” is a technology that, once licensed to a company, allows it to offer financial or payment services to its customers without requiring the necessary technology or regulatory authorizations, which remain the responsibility of the regulated financial or payment institution providing the solution.

This technology operates through APIs (Application Programming Interfaces), enabling the contracting company to offer financial services that are actually executed by the partner institution. In BaaS, APIs allow the banking solution developed by an institution to be “installed” in the system used by another company.

BaaS represents a significant opportunity for the rapid and cost-effective expansion of financial service offerings. It allows companies to respond quickly to market demands and explore new customer segments. Among the financial services that can be offered via BaaS are:

• Digital accounts;
• PIX payments;
• Issuance of debit and credit cards;
• Bank transfers;
• Bank invoice issuance;
• Loans;
• Investments;
• Open Finance;
• Payment Transaction Initiation;
• Cashback;
• Mobile phone recharges.

BaaS has been highlighted as the future of the banking sector. According to Future Market Insights, BaaS is expected to reach $12.2 billion by 2031, representing an annual growth rate of 15.7%. Brazil also stands out as a major consumer of BaaS. In a study by IMR Introspective Market Research, Brazil generated over $1.3 billion in revenue in 2021, which accounts for 73% of the total revenue obtained in South America ($1.9 billion).