Resumo

This paper focuses on proposing sixteen suggestions to the most pressing challenges faced by impact-driven fintechs in Brazil. We believe instruments like these can assist entrepreneurs to overcome such challenges and undertake socially with greater chance of success. Incidentally, the framework also has the potential to suggest meaningful directions to policymakers and educators by providing possible policies aimed at encouraging social entrepreneurship and hinting at what competencies educators should explore.

As a developing economy that struggles with financial exclusion, and at the same time has a strong hub for financial innovation, we explored the context of inclusion-driven fintechs in Brazil.

It is estimated that 1.7 billion adults are considered unbanked. Financial exclusion deprives poor households of access to useful and affordable financial products and services that meet their needs, bringing many burdens such as making them more susceptible to theft, and unable to sustain their basic needs, and having them to resort to far costlier options than those from formal financial institutions and with fewer consumer protections. In a nutshell, financial exclusion could lead the poorest susceptible to a plentiful of personal, social, and economic consequences.

We interviewed twelve founders and co-founders of ten different Brazilian fintechs that had the social-oriented purpose of inclusion to understand how they foster inclusion, their everyday challenges and what solutions they may propose to overcome them.

We ended up drawing fifteen solutions, separated into three major dimensions: Knowledge-related; Process-related; and Network-related. This suggestions include: Have an open mind; Understand your market; Elaborate your theses; Create the MVP and Validate your idea; Embed Inclusion in all processes as possible; Be sustainable. In all ways; Consider white label solutions; Take the client “by the hand”; Have fun!; Build your trusted team; Approach the right investors; Be inspiring and committed; Seek assistance from legal and accounting firms; Consider entering accelerator and incubation.

With such a potential and with all of our suggestions, we hope to have taken on more steps to facilitate the emergency, survivability and scalability of these startups whose focus is to promote social change, especially through financial inclusion. We first suggest that funding agencies such as venture capitalists recognize the limitations of inclusion-driven businesses and use more lenient selection criteria to finance them. Likewise, we urge policymakers to use such businesses as allies in their effort to address many of the country’s social problems.