Data Security Is the Big Challenge for Fintechs: Bradesco CEO

Octavio de Lazari says incumbent banks must partner with new players to keep in the game

New challengers prompt banks to seek innovation
August 09, 2022 | 04:01 PM

Bloomberg Línea — Brazil’s Bradesco (BBDC4) CEO Octavio de Lazari argues that it is necessary to be careful with the development of Open Finance, especially because of cyber-attacks, pondering that, however, there are fintechs that have good cybersecurity services.

“In Open Finance all customer data will be shared,” said the executive at the opening of the Febraban Tech event, of the Brazilian Federation of Banks, on Tuesday. “We have a lot of concern about transacting this data back and forth. The big challenge is security to preserve the data of our clients because the levels of safety are different in the institutions.”

According to Lazari, incumbent banks need to partner with fintechs, insurtechs, and other startups because “companies can’t be good at everything”. Bradesco has its startup investment arm, Inovabra, and has also bought some startups in recent years.

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Lazari also said that Bradesco needs to adjust structures because there is no longer the need for the size that the company used to have. According to him, there are 90% fewer authentications done at Bradesco’s tellers after the pandemic.

“Thirty years ago if we put all the Bradesco ATMs next to each other in a straight line it would be nearly 6 miles. These are things that no longer exist and we have to adapt to the new times. The new challengers provoke us to seek this path more quickly.”

Lazari celebrated the deflation -- that is, the drop in inflation -- in July, as reported in the Brazilian inflation index on Tuesday, and said he hopes Brazil can get rid of “the ghost of inflation” soon. Brazil’s President Jair Bolsonaro had lunch with bankers at a closed event at Febraban on Monday (8).

“I hope we don’t have high-interest rates so that people can pay their debts,” the Bradesco CEO said of the monetary policy applied that has raised interest rates in recent Central Bank meetings to contain rising inflation.

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While economists project Brazil’s GDP (Gross Domestic Product) growth for this year at around 2 percent, for next year, the outlook is for 2.5 percent growth. “I hope that the economists are wrong once again and that we have greater growth in our country. The oil price is already coming to $90, with the supply chains getting organized, we grow in 2023″, Lazari said.

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