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3 BRAZILIAN FINTECHS REVOLUTIONISING THE FINANCIAL SECTOR

In Latin America, Brazil is the largest country and the biggest FinTech market. In the first quarter of 2021, Brazilian start-ups received over $400 million. The Brazilian FinTech market in 2020 had gathered $1.3 billion, which was 73% more investments than in 2019, according to a report. This suggests to investors and every finance market that Brazil’s FinTech market was booming in time.

Across the world, there are more than 700 unicorns, and 12 of them are located in Brazil. According to VCBay, the fifth leading FinTech market globally is Brazil, and the rise of FinTech in Brazil indicates the challenges and opportunities of the Brazilian market.

The ongoing pandemic gave rise to the digital era in Brazil, which was quickly adopted by its citizens and companies alike, giving a push to technology. Offering more mobile banking options leads to more people using mobile banking services, and it’s a cycle that constantly pushes Brazilian FinTech ahead.

Below is a list of the top 3 Brazilian FinTechs revolutionizing the financial sector:

Creditas

Creditas was founded in 2012 by Sergio Furio. It is headquartered in São Paulo, Brazil, and has raised $564 million. Creditas’ mission is well-defined: to enable what fulfills people by unleashing the potential of their assets. Currently, Creditas works with home equity, auto equity, private payroll-deducted personal loans, and vehicle financing. And they are constantly researching innovative ways to help people reach new heights. They believe it is their culture to go further, think differently, educate people, and grow exponentially. They are a technology company focused on people.

Nomad

It is a company that allows you to expand financial boundaries and become a citizen of the world. Here, your money goes further. Enjoy everything the world can offer with unique ease and practicality.

Nomad is a FinTech made for those looking for more than just a bank. Through the app, you can create your American checking account and enjoy all the advantages of it, designed by Nomad for you.

NuBank

Nubank is a leading financial technology company in Latin America and the largest independent neobank in the world, with more than 20 million clients. Its first product, launched in 2014, is a no-fee credit card that is fully managed by a mobile app and used by more than 12 million customers. Almost 36 million Brazilians have requested its products.

In 2017, Nubank launched its proprietary loyalty rewards program (“Nubank Rewards”), as well as a digital account (“NuConta”) that more than 17 million people already use. In 2019, the company began testing its personal loan product and took its first steps in international expansion, opening offices in Mexico and Argentina. To date, Nubank has raised around US$ 820 million in seven equity investment rounds from TCV, Sequoia Capital, Kaszek Ventures, Tiger Global Management, QED, Founders Fund, DST Global, Redpoint Ventures, Ribbit Capital, Dragoneer Investment Group, Thrive Capital, and Tencent.

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thefintech.info

SIX KEY BENEFITS OF GOOD CREDIT

You don’t have to know much about personal finance to know that having good credit is better than having bad credit. There are plenty of scary stories about how easy it is to ruin your credit and even more tips for how to improve your credit score.

But if you’re new to credit you may not be entirely sure what the fuss is all about. Why exactly do you need good credit? Here are the biggest reasons why you should care about your credit score, and why building good credit is worth the effort.

GOOD CREDIT SAVES YOU MONEY

If you ever plan to buy a house, own a car, and use a credit card to buy anything, you’re going to want a high credit score.

Simply put, your credit score goes a long way toward determining what kind of interest rate you’re going to get from lenders. The higher your credit score, the more faith lenders will have in your ability to pay them back. When lenders feel confident in your ability to pay them back, they’re more willing to offer low-interest rates. And the lower the interest rate, the less that loan or line of credit is going to cost you.

Fool.com has a nice breakdown of how your credit score can change your interest rates and what those changes mean in terms of the monthly payment and total interest paid over the life of the debt. Someone with excellent credit can expect to pay hundreds less per month and tens of thousands less in total for a mortgage as compared to someone with average or below-average credit. If you carry any amount of credit card debt, a high-interest rate can be extremely costly. 

GOOD CREDIT CAN HELP YOU LAND A JOB

A recent nationwide survey of hiring professionals found that 25% used credit checks as part of the hiring process. Why? It’s not that they’re looking for your credit score (they aren’t able to see that). Instead, they’re looking for potential red flags.

While you may not think your credit history says much about your ability to do a particular job if your credit report shows signs of an inability to successfully manage your finances that might be disqualifying for some positions. Ultimately, it may just be another data point to consider when weighing your application against other, similarly qualified applicants.

GOOD CREDIT CAN REDUCE YOUR CAR INSURANCE BILL

Over 90% of car insurance companies review your credit when determining what insurance premiums to charge. Insurance companies, like employers, aren’t interested in your score, but they are interested in the positive behaviors that make up your score. A spotless payment history, for example, makes you seem more likely to pay your auto insurance bill on time every month.

If you do a good job managing your credit and debt obligations then insurance companies will assume that you’ll also manage your insurance obligations just as well.

GOOD CREDIT MAKES IT EASIER TO OPEN UTILITY ACCOUNTS

When it comes time to open an account for utility service, your credit report is crucial. You may not think of electricity as a form of lending, but functionally it’s not much different from a credit card: you spend as little or as much electricity as you like each month and at the end of the cycle you get a bill for what you’ve spent.

Utility companies prefer seeing that you’re someone who pays their other bills on time and doesn’t become overextended. The kind of good behavior that raises your credit score also makes you more trustworthy in the eyes of the gas company.

Poor credit doesn’t mean you’ll automatically be denied service, but it will be harder, and you may have to pay a deposit before you can establish an account.

GOOD CREDIT MAKES FINANCIAL RECOVERY EASIER

Whether you’re unemployed for a lengthy period or simply coming up short for the month, good credit makes it easier to stay afloat and manage your recovery once things are back to normal. Most importantly, having good credit makes it easier to borrow money at an affordable rate, which makes any debt you accumulate during a setback that much easier to repay when your income has returned.

GOOD CREDIT GIVES YOU PEACE OF MIND

Having good credit doesn’t shield you from every possible problem, but it does take a little bit of that burden away. This is important, because over half of all Americans report feeling anxious about their finances, with the majority citing debt as their biggest reason for feeling anxious.

So, while good credit isn’t everything, it is a big part of your overall financial health. Good credit can help turn around a difficult situation and make a good situation even better.

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thefintech.info

DO I NEED TO PAY TAXES ON UNEMPLOYMENT?

If you collected unemployment benefits in 2021, you may be wondering if you have to pay taxes on the money you received. The short answer is yes.

That’s a big change from last year when you filed your 2021 tax return on your 2020 income. For 2020 federal tax returns, the American Rescue Plan of 2021 allowed the exclusion of up to $10,200 per individual, but that tax break wasn’t extended for 2021.

As the April 15 income tax filing deadline approaches, you need to be prepared to pay federal taxes on the unemployment compensation you collected in 2021. You could be hit with some sticker shock. Here’s what to know.

WHY UNEMPLOYMENT BENEFITS ARE TAXABLE

Unemployment benefits are treated as regular income. Your benefits get reported to the IRS and are subject to federal income tax. The amount you received during the year gets added to your overall taxable income. Although the benefits aren’t specifically taxed (nothing is withheld unless you opt-in), it’s that total amount of income that shapes your tax bill.

Most states with a state income tax also collect taxes on unemployment benefits, but some do not. Check the table at the end of this article to see if your state taxes unemployment benefits and what the rate is. You can find more details about each state’s approach in this guide.

The main difference between unemployment and regular wage income is that you don’t pay Social Security or Medicare taxes on unemployment benefits (listed as FICA taxes). Also, the percentage you pay for your benefits is determined by your income bracket. For example, if you’re a single filer and you earned between $9,951 and $40,525, you fall in the 12% federal tax bracket for 2021-2022.

HOW TO HANDLE A TAX BILL IF YOU’RE STILL UNEMPLOYED

You may be feeling the financial pinch if you’re still unemployed. If you can’t afford to pay your tax bill, the IRS offers a few options.

First, contact the IRS right away to explain your situation and find out if you’re eligible for an alternative payment plan. They can discuss your options with you and set you up on a repayment plan, such as a short-term repayment plan within 180 days or a long-term installment plan over 72 months. It’s peak tax season right now, so it may not be easy to get through right away. Try to be patient.

If you’re not able to pay anything at all, the IRS may decide your account is “currently not collectible.” That designation temporarily delays their collection process.

Keep in mind, that your tax debt doesn’t go away. Penalties and interest may accrue on the unpaid amount during this “not collectible” period. You’ll also be expected to pay fees and interest on any installment plan as well. Going forward, if you can afford to pay a little bit toward next year’s tax bill, that’s advisable to avoid a lump sum in April.

HOW TO AVOID A HEFTY TAX BILL ON UNEMPLOYMENT BENEFITS

To avoid being socked with a large bill come tax time, you can voluntarily choose to withhold a portion from your unemployment benefits so you don’t get stuck with a tax bill or lose out on a refund you were expecting.

Unless you absolutely can’t manage to pay throughout the year, it’s highly recommended you opt into withholding a certain amount. The agency that pays your unemployment benefits will withhold a flat 10% to cover all or a portion of your tax bill.

Once you’ve returned to work, it’s worth making sure you have the correct amount withheld to avoid a surprise bill. Use the IRS tax withholding calculator to see how much you should withhold.

WHAT ELSE TO KNOW ABOUT UNEMPLOYMENT TAX WITHHOLDING

Even though the IRS recommends you withhold a certain amount from your unemployment benefits to cover taxes, your well-being comes first. Of course, avoiding a big tax bill is preferable, but if money is extra tight, it’s more important to pay your utility bills and keep food in your pantry. You can always work out a way to repay your bill with the IRS later. Better that than letting your fridge go unstocked.

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thefintech.info

5 STEPS EVERY 20-SOMETHING INVESTOR SHOULD FOLLOW TO BUILD WEALTH

For many 20-somethings, retirement is the last thing on their minds. But starting to invest early can set you up for financial success — especially if you want to retire early.

On Monday, Insider hosted an Instagram Live event focused on early retirement with Soledad Fernandez Paulino, a financial educator and founder of the blog Wealth Para Todos. During the Re/Thinking Re/Tirement event, an attendee asked, “What is the best way to invest in my early 20s? Is there a particular formula for it?”

Fernandez Paulino provided a step-by-step method for investing in your 20s to be financially prepared for your future.

  • Build a solid emergency fund

“Before you start investing aggressively, you want to make sure that you have an emergency fund. You want to have access to cash reserves,” Fernández Paulino said.

An emergency fund is money that you only tap into when you face an emergency, such as a job loss, large medical bill, or unexpected car repair. You don’t need to completely hold off on investing until you have an emergency fund — you just may not want to put all of your extra money into investments quite yet.

Traditionally, experts have advised that you keep three to six months of necessary expenses in an emergency fund. But some people prefer to set aside even more for a rainy day, maybe a year’s worth of expenses.

“It depends on the financial security you have in your life,” said Fernández Paulino. If you think you could find another job easily should you be laid off, you may only need a few months’ expenses in your emergency fund. But you may want more cash reserves if you think it would be hard to find a job quickly, or if you have kids or other dependents who rely on you financially.

  • Pay off high-interest debt

Once you have an emergency fund, there’s one more important step before kicking your investment strategy into high gear: Paying down any high-interest debts. Fernández Paulino said they consider “high interest” to be anything that charges over 9% APR.

You might not need to put extra money toward your federal student loans or mortgage, which tend to charge lower interest rates. But credit cards and personal loans might be worth paying down sooner because they could charge higher rates than you’d earn by investing in the stock market.

  • Find out if you have an employer retirement account

The first step in investing should be contributing to an employer retirement account if your company offers one. This could be a 401(k), 403(b), or 457(b), for example.

Fernández Paulino said this is an especially useful first step if your employer offers a match. For example, the company might contribute 100% of what you contribute, up to 3% of your paycheck. This way, you’re receiving free money toward retirement.

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thefintech.info

5 TOP SIDE HUSTLES FOR FINANCIAL PROFESSIONALS

There’s a common misconception that people who work in the financial industry must have a lot of money themselves. That’s not always the case — and accountants, bookkeepers, financial planners, advisors, bankers, and the rest could always use a little extra income, same as anyone else. 

If your primary career deals with money, you could leverage your skills and knowledge to open up all kinds of alternative income streams. Keep reading to learn about the top side hustles for money pros.

Tutor High School and College Kids

Experienced financial professionals should have no problem marketing their skills to students who need academic tutoring. Companies like Advanced Learners, for example, hire industry veterans specifically to serve college students majoring in subjects like business, economics, and finance. Those same skills could also lend themselves to a side hustle tutoring high school kids who are struggling with math or a related subject.

At the college level, the average tutor earns $14.25 an hour, according to Payscale. For high school tutors, Glassdoor estimates a similar average rate of $15 an hour.

Help Small Businesses Keep Their Books

Small businesses don’t have accounting departments — and they can rarely justify hiring a full-time accountant — but the entrepreneurs who launch those businesses often have neither the skills nor the time to keep the company’s books by themselves. 

If you’re a financial pro with a background in bookkeeping, you can launch a side hustle to fill that gap. 

Work as a part-time bookkeeper includes keeping track of revenues and expenses, entering data into software programs like QuickBooks, and performing services like paying bills, invoicing and reconciling financials. According to PayScale, part-time bookkeepers make an average of $18.31 an hour.

Help Entrepreneurs Write Business Plans

For entrepreneurs across America, the dream of owning a business will remain a dream forever without a loan — and in so many cases, getting a business loan hinges on having a great business plan. 

According to GoBusinessPlans, companies pay consulting firms $25,000-$50,000 to draft the kind of business plans that lenders and investors want to see, but entrepreneurs and start-ups can’t fork over that kind of dough. They will, however, pay qualified financial professionals with real-world experience who know how to articulate a business’ objectives and strategies with professionalism and clarity. According to ZipRecruiter, business plan writers average $28 an hour.

Become a Financial Freelancer

Freelancing isn’t just for writers and web designers. Financial pros of all disciplines and backgrounds can join the gig economy and build their side hustles on a contract-by-contract basis. There are several finance-specific freelancing sites where you can advertise your services, list your skills, compete for clients and build your client base, but Paro just might be the best of the bunch.  

The platform gives its experts — that’s you — tools for client management, productivity, and marketing to help them build their businesses while matching them with paying customers. 

Areas of expertise include budgeting and forecasting, auditing, insurance, business analysis, strategic advisory, tax services, and accounting.

Share Your Knowledge as a Guest Blogger

Finance-themed websites large and small pay industry professionals for their insight, analysis, and ideas, and you can cash in on your knowledge — and your ability to articulate that knowledge in writing — as a guest blogger. 

BloggerPassion maintains a list of financial and business sites that pay between $50-$150 per post in 2022. FreelanceWritingGigs.com has a list of sites that pay writers — including business and finance sites specifically — up to $300 per post.

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thefintech.info

HOW TO START A CRYPTOCURRENCY EXCHANGE LIKE BINANCE, COINBASE?

It is worth noting that cryptocurrencies and trading are no longer an exotic phenomenon. Even conservative-minded politicians are beginning to realize that cryptocurrencies or their further development will somehow affect the economy of the future.

Every single day, we can see new laws and decrees aimed at providing cryptocurrencies and blockchain technology with greater freedom of use and application.

Despite the volatility of the main cryptocurrencies, this market is expanding, thus providing enthusiasts with opportunities to develop the industry or simply to make a profit.

The easiest way to make money on cryptocurrencies is to invest in any coin and speculate on the volatility of exchange rates. However, regardless of whether traders and investors will earn money or lose it, the cryptocurrency exchange will benefit in both cases, but this is possible only in one situation: When the founders of such a business take into account all possible nuances (technical, legal, and even related to user activity).

So, how to open a cryptocurrency exchange? What do you need to know to launch your cryptocurrency exchange? What resources are required to create your exchange to work with Bitcoin?

This article is a detailed guide on how to create your cryptocurrency exchange and make sure that it has a chance of success in the Bitcoin or other digital assets trading market.

We are going to look at all the key steps that you need to take as a future owner of exchange business.

1. Choosing the type of exchange

Determining the type of exchange is the first and very important decision that must be made on the way to creating a cryptocurrency exchange.

Your next actions depend on this step, including licensing, software selection, hiring specialists, and interaction with commercial organizations. There are three ways of the exchange creation process in the field of cryptocurrencies: Centralized, decentralized, and hybrid.

Accordingly, there are three types of crypto exchanges: centralized (CEX), decentralized (DEX), and hybrid. Let us take a look at each of them

  • CEX (Centralized Exchange)

The Centralized Exchange (CEX) is a well-established solution in the cryptocurrency industry and is a centralized managed platform that brings buyers and sellers of digital currencies together. The CEX principle implies that the platform owner is responsible for the user’s assets.

The biggest advantage of such an exchange is that CEX is easy to use. It offers a high level of performance, and also has perfect UI and UX. To start trading, one only needs to register via email and create a password. In the majority of cases, centralized exchanges offer high-quality customer support, a huge variety of trading pairs, and gateways for withdrawals and deposits of fiat currencies. 

At the same time, by using CEX services, you have no way to own your keys. In other words, you trust your funds to the platform on which they are stored. Exchanges of this type are vulnerable to hacker attacks.

Some users may feel uncomfortable knowing that they have to share their data when going through the KYC procedure.

These are the main disadvantages of CEX.

First of all, the future owner of a CEX exchange has to ensure the security of the exchange, as well as the convenience for users and the processes of aggregation of liquidity.

  • DEX (Decentralized Exchanges)

Decentralized Exchanges (DEX) are an alternative to CEX.

In this case, the company or another person is not responsible for your assets, while all transactions are carried out by using smart contracts and decentralized applications.

Therefore, the main advantage of decentralized exchanges is the absence of security breaches, provided that smart contracts are written in compliance with all necessary procedures.

On the other hand, users will have to deal with the following disadvantages: low liquidity, poor user interface, limited transaction speed, lack of fiat gateways, and lack of customer support.

If are thinking about opening a DEX cryptocurrency exchange, you need to understand that your cryptocurrency exchange will be less attractive for beginning and inexperienced users because it does not provide customer support, and also does not provide fiat gateways, unlike CEX.

  • Hybrid Cryptocurrency Exchanges

Hybrid exchanges combine the advantages of the CEX and DEX approaches.

They offer high transaction speed and also provide a high level of security because the customer remains the owner of the private key.

This type of exchange is still in the development stage, and it may take several years to see how it will fit into the market and whether it will be able to replace the traditional DEX and CEX.

2. Choosing a jurisdiction

As we mentioned earlier, investing in cryptocurrencies and tokenization of assets is a trend that is unlikely to disappear in the foreseeable future, thus, regulation and government control over this area is likely to continue to develop.

Thus, anyone planning to open a cryptocurrency exchange should also think about the jurisdiction of the platform.

By choosing a jurisdiction to launch a crypto exchange, you are choosing a set of laws and trends, including taxation, accounting, and business management.

In different regions, regulatory conditions can greatly vary: From a clear set of rules to a total ban or a complete lack of regulation.

Even though the latter option may seem attractive, remember that sooner or later this legislative gap can be filled. It can affect you in a truly bad way regardless of the specifics of your business.

Such countries as Malta, Gibraltar, Switzerland, and Singapore are considered attractive for the crypto business.

However, any legislation tends to change, so it is necessary to monitor the situation in this area to be aware of any changes and register a company for cryptocurrency trading in the best location for your business.

The issue of integrating the payment system into the exchange is also related to jurisdiction.

Any cryptocurrency exchange should have a set of tools that allow exchanging cryptocurrencies for fiat currency to generate income. Therefore, before creating a cryptocurrency exchange, it is necessary to find out if it is going to be possible to cooperate with local banks to ensure the withdrawal and deposit of funds.

3. Software selection

The choice of software is one of the fundamental tasks that are critically important for launching a cryptocurrency business with the prospect of sustainable development.

Your software is responsible for executing transactions on your exchange, wallet operations, depositing and withdrawing funds, and many other vital processes.

Your choice determines the final cost of the technical solution and the time required to launch the exchange.

Crypto exchange architecture

  • Matching engine

The matching engine is the core of the exchange.

The matching engine is a system that collects all open buy and sells orders and compares them, thus ensuring the execution of transactions.

  • Wallets

Crypto wallets allow you to store, deposit, and withdraw cryptocurrency.

There is a wide choice of wallets available: multi-currency wallets and those working with one type of cryptocurrency.

The functional model of the crypto business requires fiat gateways for depositing and withdrawing fiat money, as well as a security system that will ensure the safety of funds.

  • Administration panel

The key task of such a panel is to monitor the entire trading system, including wallets, and transactions.

This tool also serves to customize the website and add new features that may be required as your business grows.

  • Trading platform

A trading platform is software that allows traders to place orders and manage their trading accounts.

The popularity of the exchange among users largely depends on the convenience of using the platform.

  • User account

The user’s account is a portal where exchange customers can manage their funds.

The account allows you to register and check their balance, deposit and withdraw funds, as well as use available reporting and analytics tools.

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KOHO: MADE FOR YOUR MONEY

We get it – it’s tough out there. But no matter where you are with money, KOHO can help. KOHO. Made For Your Money. KOHO is no-fee spending and savings account with instant cashback to simplify your personal finances. Sign up in minutes to join over half a million Canadians who use KOHOs to budget and save.

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