Nubank is unique among digital banks globally because it is both unusually large in terms of customers and profitable. Other profitable online lenders, such as Korea’s Kakao Bank – which has about 22 million customers – are significantly smaller. Even the wildly ambitious Revolut is less than half as large as Nubank.

Compared to Revolut, Nubank has expanded its operations with more discipline. The Brazilian digital bank has only established operations in two other countries – Mexico and Colombia – both in Latin America. Nubank currently has 8 million customers and US$3.3 billion in deposits in Mexico and $220 million in deposits in Colombia.

Revolut, on the other hand, has expanded to the other side of the world from its UK headquarters, including countries that are not a natural fit for its products, such as India and Japan. Over time, if Revolut wants to ensure its success in its Europe, North America and Australia, it will probably have to pare down some of its other operations.

While Nubank does not have to worry about the high costs of overzealous international expansion, it does seem to have a problem with delinquent loans. While delinquency rates for loans from 15 to 90 days decreased to 4.5% in the second quarter, loans of more than 90 days ticked up to 7% from 6.3%.

That followed a concerted effort to grow the credit business, chief financial officer Guilherme Lago told Bloomberg. “The increase in delinquency was intentional and very well within expectations,” Lago said. “I don’t think it should come as a surprise.” Lending as a portion of the credit portfolio has risen to about 25% from 15% over the last few years and carries a higher delinquency rate than credit cards, he explained, adding that the bank is being properly compensated for the higher risk. 

Nubank’s total credit portfolio ended the quarter at $18.9 billion with lending growing 92% from a year earlier and credit cards up 39%.