AI Driven Credit Growth and Stablecoin Strategy in Banking

Nubank says AI driving credit growth

Some weeks more than others it’s striking how much the news features major financial players who are less than 20 years old but are already deeply embedded into international payments and banking, such as Stripe, Nubank, and Revolut. Nubank has announced a 55 per cent year on year growth in its credit margins which it credits in part to deploying new AI tools in its credit models. “Nubank, as the firm is known, said its net interest income advanced 55% year-over-year to $2.8 billion, according to results released Wednesday,” reports Bloomberg. “The adjusted net interest margin gained 0.6 percentage points over the same period, to 10.5%. Part of the expansion was linked to the deployment of a new credit model that uses AI tools to better assess each client’s risk, Nubank said. First deployed in Brazil, the strategy increases the company’s willingness to raise limits for certain groups of borrowers.” It’s been a successful year for the fintech, which wrote last month that it has become the largest private financial institution in its home country of Brazil where it now has 112 million customers. Livia Chanes, CEO of Nubank in Brazil, said in a recent videocast that 85% of the customer base in Brazil remained active monthly, and the average revenue per active customer (ARPAC) reached its all-time high in the third quarter of 2025. "More than growing in numbers, our focus is on a significant presence in people's financial lives," he said. The company is in the process of applying to become a bank in the US.

Stripe's unfolding internet predictions

It’s time for Stripe’s annual letter, which this year focuses on the potential for Agentic Commerce and stablecoins, which it sees as new cogs in the internet engine. While not all companies need lending, most companies need to take payments, and Stripe is exposed to a broad range of new players entering business. Some outtakes: Stripe notes a bifurcation in the economy between bricks-and-mortar and e-commerce. “In retail, for example, US brick-and-mortar sales grew just 5% over the past 3 years, whereas ecommerce sales grew 30% over the same period (both in inflation adjusted terms). Economy-wide, demand for software, computers, and data center investment drove nearly half of all US GDP growth in 2025 and will likely soon be the majority of US growth.”Stripe also sees a changing trend where many businesses launch globally by default, rather than starting in one market before expanding internationally. “The latest cohort of fintech companies—Sling Money, DolarApp, Félix, and KAST, to name a few—are building global financial apps right out of the gate. Similarly, last year we launched our first globally native product, Financial Accounts, which businesses can use to hold, send, and receive funds. We made it available to businesses in more than 100 countries on day one. As we look at these figures, there is an obvious question: is 2025 an anomaly or the beginning of a new regime? Time will adjudicate, but our best guess is that the 2025 acceleration is the start of a larger inflection in entrepreneurship and creativity facilitated by advances in large language models. We have an ambitious roadmap of improvements planned. Stripe will be the best way to build a business in the era of AI.” The letter noted growth of just 1 per cent per annum in OECD economies over the last 20 years, which is adjudicated to be due to a lack of capital – noting of course that Stripe Capital is one of its business lines which lends working capital based on payments data. “Only 41% of small business loan applications were approved in the US last year, down from 50% in 2015.” Naturally, Stripe promotes its payments systems as the growth solution. “Unlike more speculative paths to growth, optimizing your payments setup is almost guaranteed to yield extra revenue and to be among the highest-ROI growth activities you could undertake.”

UK bets on Revolut for stablecoin test

Revolut, early to offer a platform for cryptocurrencies, is keen to use a stablecoin to power its extended international payments network. Today it emerges that the UK regulator the Financial Conduct Authority has selected Revolut along with Monee Financial Technologies, ReStabilise and VVTX to test stablecoins in its ‘sandbox’. “‘We are supporting UK stablecoin issuers to ensure they can be trusted for payments, settlement and trading,’ said Matthew Long, director of payments and digital assets at the FCA, adding this would ‘benefit consumers and financial transactions’ and help to deliver the UK’s objective of upgrading the country’s payments system,’ reports the FT. “The FCA said Revolut was exploring a pound-denominated stablecoin that is designed to maintain a one-to-one value with sterling by keeping its backing funds in UK ‘reserve assets’. The stablecoin would allow customers to ‘buy, hold, sell and transfer the asset within the Revolut platform and across the crypto ecosystem’.” The UK has fallen behind the US and the EU, which have both already developed stablecoin legislation. UK regulators have a complex relationship with Revolut, which is the most valuable fintech in Europe. Revolut’s UK banking licence is still in process, but it also looks like the best bet to deliver a UK sterling-backed stablecoin.

Ex-Revoluter helms the next billion dollar bank

It’s been a while since the UK had a new billion-dollar bank, but SME-focused digital bank Allica will hit that mark this week with a Series D funding round that will value the bank at $1.2 billion. It illustrates a major shift in the SME lending market over the last decade. Allica, founded in 2015, is aiming to grow its business into Northern Europe, perhaps through an acquisition. It is led by former Revolut executive Richard Davies. As City AM reports, Allica delivered a record 86 per cent increase in pre-tax profit to £29.9m as lending activity topped £1 billion. Davies said last year the small business lending market had been a “barren wasteland” five to 10 years ago and Allica’s “strategic focus” on the area was key to its growth. “Digital lenders like Allica – which was named City AM’s bank of the year in 2025 – have been able to seize the vacuum left by big banks, which have turned away from the sector,” said the paper. “Challengers now account for 60 per cent of the market, compared to 2019 where the four largest banks made up 90 per cent of lending.”