SAO PAULO (Reuters) – Brazilian digital lender Nubank has signed an agreement with Mexican convenience store chain Oxxo, operated by FEMSA, to expand its cash deposit and withdrawal network in the North American country, the companies announced on Thursday. monday

WHY IT’S IMPORTANT

Warren Buffett-backed Nubank, one of Latin America’s largest companies by market value, is looking to expand its operations in Mexico and Colombia after growing in Brazil, its home market, where it has more than 100 million customers.

While Nubank’s operations in Brazil are almost entirely digital, the lender is using different strategies to grow in Mexico, where cash remains a predominant means of payment.

IN THE NUMBERS

The deal will allow Nubank’s more than 9 million Mexican customers to access Oxxo’s more than 22,000 stores nationwide, Nubank said, pushing the lender’s total presence in Mexico to more than in 30,000 stores, including previous partnerships.

Cash withdrawals with a Nubank card will be available at Oxxo stores in Mexico from Tuesday, while the option to deposit money into a Nubank account will begin “in the next few months,” Nubank said.

MARKET REACTION

Citi analysts said the deal is “positive” for Nubank, as Oxxo’s network will expand access to Nubank’s client base in Mexico.

But they say it is “probably expensive” and note that it is not exclusive, as Oxxo already offers capabilities for other major banks in Mexico.

“We believe that this reaffirms the commitment of Nubank to offer cash-in/out capabilities on a scale, which reduces a competitive disadvantage of the incumbent banks in Mexico,” the analysts , including Gustavo Schroden, wrote a report to clients.