Nubank releases an unhelpful “prepaid” card. Understand why

lately , Nubank About a new type of loan that offers affordable rates to those who transfer wages to the digital account. right Now , Financial technology It will also introduce a kind of Prepaid Card Which can help its users to get a credit card in the institution.

The new product consists of creating a reservation for the card, and this amount will be automatically converted to a credit limit available for in-store and online purchases. This amount acts as a security for payment until the invoice is paid.

With the “prepaid” card, Nubank co-founder Christina Junqueira, fintech also intends to serve Brazilians who have restrictions with credit protection agencies like SPC and Serasa, and for this reason, credit services are difficult to access.

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“In Brazil today there are more than 60 million people who cannot be approved for a traditional credit product because they do not have a history or have a“ dirty name ”in the main offices and current public data sources. Nubank’s proposal is to introduce this portal, and to“ give gas ”to this access. Inclusion is crucial to financial inclusion, says Christina.

“For many Brazilians, this should be their first experience with a similar product to a traditional credit card, which allows purchases in any type of personal establishment or online,” he added.

The New Nubank Card Is Worth It?

At first, the novelty may seem helpful, but in practice, it might end up being financially useless. This is because the amount will be blocked until the bill is paid, and only then will it be released.

Thus, it is better to simply pay the purchase value in cash, rather than ‘paying twice’ for it, as the former is when the value is blocked, thus the user loses access to the value as if it had already been spent, and the second, when the payment has already been made.

Read also: Nubank is the best bank in Brazil for the third year in a row, according to Forbes