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Brazilian digital bank Nubank gets preliminary approval for U.S. banking license

Brazilian digital banking giant Nubank recently received conditional approval from the U.S. Office of the Comptroller of the Currency (OCC) for the establishment of its de novo national bank, marking a key step in the company's official launch into the U.S. market, according to reports.

The regulatory clearance is seen as a major milestone in Nubank's internationalization strategy, which currently has approximately 127 million customers in Brazil, Mexico and Colombia. It is planned that upon final full approval, the national bank license will enable Nubank to operate under a unified federal regulatory framework and launch financial services such as deposit accounts, credit cards, loans, and digital asset custody in the United States.

Nubank says this will provide the foundation for a complete digital banking system in the United States. Nubank is currently in the "banking organization phase," which requires the company to meet specific OCC regulatory conditions while continuing to wait for approvals from the U.S. Federal Deposit Insurance Corporation (FDIC) and the Federal Reserve.

In accordance with regulatory requirements, Nubank needs to capitalize the bank within 12 months and officially open within 18 months. As the organizational phase progresses, Nubank is in the process of laying out a number of strategic hubs in the U.S., including Miami, the San Francisco Bay Area, Northern Virginia, and the Research Triangle in North Carolina.

Cristina Junqueira, one of the co-founders of Nubank, has relocated to the United States to drive business development there. She says that obtaining federal approval for a national banking license is an important step in Nubank's journey to becoming a sound, compliant and competitive regulated financial institution in the United States.

David Vélez, co-founder and CEO of Nubank, also noted that this approval is not only an expansion of the business footprint, but also an opportunity to validate the company's core philosophy of a digital and customer-centric financial model with the long-term potential to grow globally.

Therefore, today we share the business environment in Brazil and the benefits of incorporating a Brazilian company, as well as the types of Brazilian companies and tax rates, to provide professional support for cross-border sellers who plan to incorporate a Brazilian company or those who already have a Brazilian company.

01 What is the business environment in Brazil?

What are the benefits of Brazil's foreign investment climate for registering a Brazilian company?

In recent years, the Brazilian government has taken a number of measures to improve the business environment and attract the inflow of foreign investment.

The Brazilian Investment Promotion Agency (Apex-Brasil) actively promotes the entry of foreign investors into the Brazilian market with various policy incentives, including tax incentives, simplified approval procedures, and investment subsidies.

However, despite the fact that Brazil shows great potential for investment in a number of areas, there are still a number of potential risks that foreign companies need to deal with when operating in the country.

First, Brazil has a complex tax system. Brazilian taxation involves three levels of federal, state and municipal taxes, and there are significant differences in tax rates and tax requirements between states and municipalities, resulting in higher compliance costs for companies.

Second, Brazil's laws and regulations are lengthy, with more administrative approvals and legal requirements, especially when it comes to environmental protection, labor regulations, and foreign exchange controls.

In addition, the Brazilian economy is highly cyclical, with high inflation and volatile financial markets.

Historically, Brazil's high inflation rate, currency devaluation and high interest rates have posed serious financial risks to foreign companies.

Although the Brazilian government has stabilized the economy to a certain extent in recent years through macroeconomic regulation policies, changes in the global economic situation may still have a greater impact on the Brazilian economy.

Finally, Brazil's infrastructure development, although gradually improving, is still inadequate in some areas. Especially in the interior, roads, ports, airports and other infrastructure are relatively poor, which may affect the efficiency of supply chains and logistics costs for enterprises.

If you need to register a U.S. company / Singapore company / Japan company / Thailand company / Malaysia company / Canada company / Mexico company / Brazil company / UK company / France company / Germany company / New Zealand company / Vietnam company / Indonesia company / Philippines company / Dubai company and other foreign companies registered in the relevant business and taxation services, but also to provide Hong Kong company / Shenzhen company / Guangzhou company / Shanghai company / Hangzhou company / Beijing company / Hainan company and other domestic companies registered corporate services, company annual audit / bookkeeping tax / pay MPF / change information / bank account opening / ODI filing / BVI registration / tax compliance Company / Hangzhou company / Beijing company / Hainan company and other domestic companies registered corporate services, company audit audit / bookkeeping tax / payment of MPF / change information / bank account / ODI record / BVI registration / tax compliance / cross-border e-commerce accompanied by running on behalf of the operation of the enterprise one-stop service, you can add my WeChat (phone with V: 13045886252) at any time to consult ↓ ↓↓↓ 

02 Why incorporate a Brazilian company? What are the benefits?

Let's start with what are the benefits of registering a Brazilian company and why you need to register a Brazilian domestic company to sail to Brazil.

1) Product Certification

Brazil has a strict certification system for imported products in order to maintain market order and protect consumer rights, and any uncertified products are at risk of being seized.

So what is the inevitable relationship between a Brazilian local company and product certification? Maybe you don't know, there is a mandatory condition before doing product certification, that is, you need a Brazilian company as a licensee in order to do the certification, so many sellers will be stuck in this step.

(2) Tax self-declaration

Brazil is a country with a complex and varied tax system, which has many types of taxes.

For companies, understanding and mastering tax filing is a key step to successfully entering Brazil.

Currently, Brazilian local companies are adopting the self-declaration model in terms of tax payment, which means that sellers can reduce their operating costs and increase their profit margins by reasonably planning their taxes, otherwise, it may give you a big headache in terms of the amount of tax payment.

3）No need to prove the flow of water in the store and be able to open full

If you are a new seller, only cross-border store, you must provide the relevant mainstream platform (single platform single store) in the past 6 months the average monthly water flow of more than 5000 U.S. dollars to prove in order to be stationed, this is a mandatory condition, otherwise you will not be able to carry out your business blueprint.

Secondly, having a local Brazilian company that can open full warehouses has two major advantages.

Product Flow:After opening the FULL warehouse, the product page will have a "green FULL mark", the traffic and ranking of the product link will be significantly improved, and the weight of the store will be higher. Especially during the promotion activities, FULL warehouse products will get more exposure.

Logistics:The use of FULL warehouse can reduce the tediousness of logistics operations, shipping directly from the official warehouse, and ensure that orders are processed within 24 hours, according to the buyer's address to control the product delivery in 1-3 working days.

If you plan to register a U.S. company / Singapore company / Japanese company / Thai company / Malaysian company / Canadian company / Mexican company / Brazilian company / British company / French company / German company / New Zealand company / Vietnamese company / Indonesian company / Philippine company / Dubai company and other foreign companies registered in the relevant business and taxation services, but also to provide Hong Kong company / Shenzhen company / Guangzhou company / Shanghai company Company / Hangzhou company / Beijing company / Hainan company and other domestic companies registered corporate services, company annual audit audit / bookkeeping tax / payment of MPF / change information / bank account / ODI filing / BVI registration / tax compliance / cross-border e-commerce accompanied by running on behalf of the operation of the enterprise one-stop service, you can add my WeChat (phone with V: 13045886252) efficient and professional arrangements on the ↓↓↓↓ 

03 BrazilType of company registration

Enterprises can choose from the following three forms of registration depending on their situation:

1) Local wholly owned company (simple and fast timeframe)

Registration time: usually about 3-4 weeks;

Registered capital: unlimited capital injection, no need for paid-in capital;

Advantages of registration: local account opening, simple process, speed;

Requirements for registration: Brazilian/permanent resident/blue card holder as legal representative and 100% shareholding.

2) Foreign holding company (compliance holding preferred) 

Registration time: 1-3 months;

Advantage of registration: foreign enterprise control, platform entry is more compliant.

Registration Requirements: 99% foreign shareholding + 1% shareholding by Brazilian legal representative / 100% foreign shareholding;

Registered capital: unlimited registered capital, no need for paid-in. (Except for specific industries or the need to apply for import and export quota at a later stage)

3) Investment immigration companies (long-term layout, safe and controllable)

Registration time: about 3-7 months;

Advantage of registration: you can get permanent residence, the legal representative is your own person, compliance and security;

Registered Capital: Paid-up capital is required, with a minimum of R$150,000 paid-up capital (but with 10 registered Brazilian employees) or a one-time investment of more than R$500,000;

Registration requirements: first find a Brazilian to be the company's legal representative to register the company, then Chinese people for investment immigration visa, get the identity of the legal representative of the company changed to Brazil.

How to choose the type of company registration?

If you are initially testing the waters of the Brazilian market, you can choose a local wholly-owned company; if you need foreign control and emphasize compliance, it is recommended that you choose a foreign holding company; if you plan for long-term development and hope that the legal representative will take control of the company on his or her own, an investment immigrant company is more appropriate and safer. If you need to register a Brazilian company or start a cross-border business in Brazil, feel free to inquire (WeChat: 13045886252)▼▼▼▼

04 How are Brazilian companies taxed?

How does a Brazilian company choose the method of tax calculation? There are currently three types of tax calculation methods.

(1) Simples Nacional (Simplified Taxation Act)

Created specifically for small and micro businesses with annual revenues up to $4.8 million, the tax system pays a single tax (DAS) based on the type of business, which includes federal, state and municipal taxes.

The simplified tax method uses a progressive form of taxation, taxed as a percentage of a business's gross receipts, usually between 4% and 19%, and is paid on a monthly basis.

Simplified tax system tax rate table / Image from the Internet

The tax system has certain limitations - it is not available to companies with annual revenues of more than R$4.8 million, to foreign companies, and to some companies belonging to specific industries (finance, transportation, electricity, importers of cars and motorcycles, etc.).

(2) Lucro Presumido (imputed profit method)

The tax system is based on corporate income and estimated profit margins to calculate taxable income, which is then used to calculate the income tax (IRPJ) and the net profit social contribution charge (CSLL).

In estimating profits, taxable income is 81 TP3T of the business's gross receipts from the sale of goods in the case of a business that sells goods, or 321 TP3T of service receipts in the case of a business that provides services.

In addition, companies that choose the imputed profits method of taxation are subject to income tax (PIS rate of 0.651 TP3T and COFINS rate of 31 TP3T), which is calculated on a cumulative basis, and the tax base for this method is gross business income, with no credit against the tax base for the company's related costs and expenses.

The imputed profits method is subject to certain limitations, such as the exclusion of companies with annual revenues exceeding R$78 million and financial institutions from the use of the tax system.

3) Lucro Real Profit Method

The tax regime applies to businesses with annual revenues exceeding R$78 million or those that want to keep precise records of income and expenses, detailed accounting of costs and expenses, and have requirements for completeness and accuracy of financial records.

The Actual Profit Method requires a business to accurately record revenues and expenses to calculate net profit, deduct tax-exempt income through actual profit, and add non-deductible income tax expenses to calculate the business's taxable income.

If you need to register a Brazilian company or go to Brazil to start a cross-border business, feel free to inquire (WeChat: 13045886252)▼▼▼

05 How do cross-border sellers or entrepreneurs choose the Brazilian company tax calculation method?

1) Simplified tax system

The exclusive simplified tax system for micro and small enterprises can reduce their filing costs, and the simplified tax system is recommended for non-foreign enterprises upfront.

2) Projected profit method

Suitable for SMEs with high accounting difficulty, extrapolating profits on a fixed percentage basis reduces accounting complexity.

3) Actual profit method

Suitable for large enterprises or enterprises with complex cost deduction needs, taxed at true adjusted profit is more in line with the actual business situation.

Which tax regime is ultimately appropriate will require tax planning by a professional Brazilian accountant based on the cost structure, profit margins, etc. of the Brazilian company during the actual business process.

In addition, it should be noted that Brazilian companies need to choose the type of tax system at the beginning of each year before January 31, miss the time will be used in the previous year, the choice of tax system will determine the enterprise's tax rate, tax calculation and tax cycle, and can only be changed once in the year, the three types of tax system to meet the conditions of the situation can be switched at will.

If sales during the year exceed the amount of the current tax system, conversion will be mandatory, and if you continue to use the current tax system, you will face the risk of high penalties, such as back payments of ICMS differences and late payment fees.

The tax department will require companies to complete the tax conversion in the first filing cycle after the overage, and the conversion may be effective retroactively to January.

Brazil has been getting hotter and hotter lately, and with its large consumer base and increasingly mature e-commerce system, it has gained the favor of many big players such as Meituan, Shuttle, and Tencent, and they have been going to sea to this place.

Of course, Chinese cross-border e-commerce companies are no exception.

If you need to register a Brazilian company or go to Brazil to start a cross-border business, you can drop me to advance as early as possible (WeChat: 13045886252)▼▼▼

06 Choosing Enterprise Caiying Group as a long-term partner

🏆 Why choose Enterprise Finance? --Professional strength, global trust

Enterprise Caiying Group, since its establishment in 2015, has always been adhering to the mission of "empowering every entrepreneurial dream", focusing on providing one-stop globalized industry, commerce, finance and tax and business services for enterprises.

Our bottom line, from the deep precipitation and authoritative certification:

✅ Service Scale Witnesses Reputation: Accumulated services for more than 300,000+ enterprises, long-term cooperation with more than 50,000+ customers.

✅ Global Network Local Support: Branches are set up in Beijing, Guangzhou, Shenzhen, Hong Kong, Southeast Asia, and the United States, with services covering Asia, Europe, and the Americas.

✅ Official certification qualification escort: with 3 Hong Kong government certified licensed secretarial firms, a U.S. branch and a self-employed Hong Kong accounting firm, and at the same time is the vice president of the Shenzhen Agency Bookkeeping Association, etc., to ensure that the service is fully compliant and reliable.

The four core advantages of Enterprise Caiying's overseas company registration service:

🔹 1. A team of experts to guide you throughout the process

Our team of nearly 400 professionals consists of senior lawyers, accountants, tax accountants and cross-border business consultants. They are well versed in international regulations, handle thousands of high-end cases annually, and can provide optimal customized solutions from structural design to on-the-ground implementation.

🔹 2. digitally empowered, smart and efficient

We have spent 20 million RMB to research and develop our own digital system "Echobo", which realizes process standardization and progress visualization. The integration of AI intelligent analysis can provide quick insight into demand and assist in generating solutions, making complex affairs clear, transparent and efficient.

🔹 3. Eco-links, extra value

We connect over 500,000+ entrepreneurs with domestic and international associations. By regularly organizing cross-border salons, tax law seminars and other activities, we not only solve registration problems, but are also committed to linking resources and creating business opportunities for you.

🔹 4. Full-cycle accompaniment for worry-free sailing

Our services go beyond "successful registration". We provide a full life cycle of services from early consultation, mid-term implementation, to late financial and tax declaration, annual audit and maintenance, and compliance consulting, to become your long-term and stable partner for overseas expansion.

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Image source: some of the image material in this article from the network, such as copyright issues, please contact us to replace the deletion of processing.

Information reference: The content of this article is synthesized from the internal materials of Enterprise Caiying and relevant public network information.

Content Editor: This article was edited and designed by the Operations Department of the Enterprise Caiying Group.

Warm reminder: The relevant policies, conditions, time limits, fees and other information described in this article may be subject to dynamic adjustments, please refer to the latest official announcements or the actual application of the specific circumstances prevail.