Can Nu Holdings Propel You to Wealth?

TradingKey - A lot of people have asked if one stock can really increase your net worth significantly to the point where you can reach the seven-figure mark. 

According to UBS (UBS), as of December 31, 2024, there are an estimated 23.8 million millionaires in America. We have all heard stories about how compounding in the market is an amazing thing, but it normally does not happen at the same time or so rapidly. 

And this is when you look at the business model of Nu Holdings (NU) and their Nubank, which is one of the largest digital finance companies in the world; Nubank is hard to ignore in relation to the way they are positioned to be an integral player in Latin America and the world of digital banking. 

Nu is a rapidly growing platform and has a total of 131 million customers across the world. This growth makes Nu one of the largest and fastest-growing digital financial institutions in the world. In Brazil, Nu has the largest number of customers of any private bank (the Central Bank of Brazil). In Mexico, Nu is the largest issuer of new credit cards, with approximately 15% of the adult population as customers. In Colombia, Nu has over 4 million customers. The introduction of the subscription credit card has also resulted in an almost threefold increase in the approved applications for the card.

What Nu Offers and How It Scaled

Founded with a no-interest fee, net-cash purple credit card, and attracted quickly 10 million customers within 5 years. 

Initially focused on just one credit card product, Nu now offers many credit cards, savings accounts, personal loans (including loans to individuals and small and medium businesses), an investment platform for stocks and cryptocurrency, as well as both insurance and many additional financial services/products.

In 2025, Nu reported $16.3 billion in revenue for the year (a 45% increase over 2024) and $4.9 billion in revenue for Q4 (a 45% increase over Q3), as the company continues to see growth in usage and monetization on its platform. Sequentially, net interest income (NII) reached a new record high of $2.8 billion, up 13% from the previous quarter.

Why Nu Stock Still Has Room to Run

The most direct approach for Nu is to replicate its success in Brazil to Mexico and Colombia--using the same formula in each country without any changes. 

The commonalities of the three countries will help Nu's digital banks thrive: there are young demographics, high smartphone usage, and regulators creating new possibilities within the financial services sector by promoting innovation. 

Each major bank in Brazil, Mexico and Colombia charges excessive fees to their customers when considering the top five banks in each country in terms of deposits and outstanding balance. Because of these fees, there is significant potential for Nu to be successful with a low-fee model. 

There is plenty of room for growth as well, with 96 million unbanked adults in Brazil, Mexico and Colombia and the low level of credit cards compared to bank accounts in these same countries. The more users that join the ecosystem, the more opportunity Nu has to cross-sell products such as savings, lending, insurance and investments, creating more engagement and increasing potential for monetization.

Global Ambitions Beyond Latin America

The company has made recent attempts to gain entry into the U.S. as part of its global expansion plans. It submitted an application for a national bank charter to do so; gaining access to this type of charter would indicate that they have confidence in their technology assessment (the ability to support the growth of the brand) and that they can adapt their model into an established, competitive, and very heavily regulated environment. 

Successfully gaining entry would provide additional avenues for future growth beyond what will be available as currently existing markets, but the challenges of creating a separate and unique identity and surviving within the U.S. will be significant and will generally take considerable time and effort to achieve.

Is Nu Stock a Millionaire Maker?

While it may be tempting to think that a modest position in Nu could turn into life-changing wealth, the numbers place limits on that possibility. 

Currently valued at over $69 billion, turning a $10,000 investment into $1 million in the next couple of decades would require Nu’s value to reach around $6.9 trillion – more than double the current combined market value of the top five largest financial companies. Even for a company with an outstanding business model, this would seem unlikely. 

One likely conclusion from all of what Nu has accomplished so far is that it has built good momentum due to high levels of customer acquisition and improved profitability, is in markets with strong demographics (underpenetrated), and is leveraging those strengths into multiple product opportunities and new markets. 

Therefore, while it may not guarantee a future million-dollar investment, it could still be a very good compounder for long-term investors if they continue to execute well on unit economics, maintain a high level of credit quality as they grow their lending business, and continue to provide an attractive value proposition for their low-fee customers without significantly diminishing their own profit margins.

The main point that investors need to take away about Nu is simple: there are already enough users for Nu to be successful. In addition, Nu is growing at a very fast rate, has an innovative way of reducing costs (as opposed to charging high fees), and is exploring new possibilities in other locations.

Nu still has great potential for future growth, but requires execution on its business strategy to generate positive returns for its long-term investors. This requires that success be achieved through continuous improvement in the things that have allowed Nu to grow to date.