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PagoNxt readies for growth engine stage

Santander has reported its Q3 21 results, providing an update about its digital subsidiary PagoNxt, and while profit remains elusive, the company’s growth provides strong foundations for its planned development.

PagoNxt revenue following Santander Q3 21 results

Nine-month revenue for the first three quarters of 2021 saw a 41% increase compared to 2020, with PagoNxt seeing 75% year-on-year climb for Q3 on a constant basis. Santander also reports that PagoNxt is on track to reach 50% revenue growth for H2 21 compared to H1, and is now seeing pre-pandemic volumes.

This was led by its Merchant Solutions division, which includes the recently listed Getnet Brazil, that saw a 53% increase in total payments volume for the first 9 months of 2021. Trade solutions, which includes One Trade and Ebury, has meanwhile grown its customer base, reaching 220,000 cross-border customers, while Consumer Solutions, which covers the Superdigital brand, saw a 13% increase in active customers in Brazil.

However, there is little sign of the breakeven that the company projected would occur by mid to late 2022 in its last earnings release, with its pre-tax loss growing to -€74m – the highest across all quarters.

Despite this, Santander remains positive about the long-term potential of PagoNxt, highlighting that while it had been deploying its projects within the company’s banks, it was now starting a new phase that would see PagoNxt turned into “a growth engine” globally. This includes a continued focus on digitisation of established Santander customers’ payments and operations, aided by the wider company’s local knowledge of different markets, as well as a new pursuit of open market opportunities beyond the bank. 

Core to this will be the launch of several global platforms, including a new global technology platform under the One Trade Brand, which will connect to all of Santander’s banks, and a multi-country platform under the Superdigital brand focused on financial inclusion, which has already launched in Argentina. 

How PagoNxt will fit into Santander will be an interesting question, especially if it continues to spin off individual segments of the business.

How are PagoNxt brands competing on price?

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