In 2023, Brazil's fintech sector faces a significant challenge, with major players like Open Co and Nexoos experiencing a 60 per cent default rate on certain loans, according to The Rio Times. This rise in defaults has led to turmoil in the US$13.2bn FIDC market, pushing the delinquency rate up to 9.5 per cent from 3.5 per cent over six years. The FIDC market involves the trading and issuance of "Fundo de Investimento em Direitos Creditórios," a type of Brazilian investment fund that acquires receivables, such as invoices and credit card payments.
