Banking firm BBVA returned to reinvest in Neon, part of a group of digital banking portfolio companies it has built, increasing its stake to nearly 30%.

Financial services firm BBVA agreed on Monday to invest $300m in Brazil-based digital bank Neon in return for a 21.7% stake, a deal highlighting traditional banks’ interest in their emerging digital equivalents.

Founded in 2016, Neon operates a digital banking platform with 15 million registered accounts and offers free checking accounts, credit and debit cards, small business products and payroll loans.

The round takes the company’s total equity financing to $423m and increased BBVA’s overall stake to 29.7%, including the shares taken by the venture capital firm it funds, Propel Venture Partners.

Propel had taken part in Neon’s last round, a $300m series C round in September 2020 also featuring digital payment processor PayPal’s corporate venturing unit, PayPal Ventures, having first backed it at series A stage.

Another Brazil-based neobank, Nubank, went public in a $2.6bn initial public offering in December 2021, with existing investor Berkshire Hathaway, buying…

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Fernando Moncada Rivera

Fernando Moncada Rivera is a reporter at Global Corporate Venturing and also host of the CVC Unplugged podcast.
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