Brazil

Case Study – Consumer Credit.

Client: Hedge Fund, San Francisco, USA

Client Opportunity: Fund exploring a range of investments to take a position in the Brazilian consumer credit sector.

Questions from Client: Scouting potential portfolio investments in the sector. What is the track record of major consumer credit providers thus far? What new strategies are they introducing given results from pilot programs? What government regulations impact the sector and how do they impact the strategy of existing players? How are consumers reacting to new credit options?

Products Provided to Client: Analytical memo; follow-up field updates via email with weekly developments; direct email exchanges with local contributors.

Foglamp Contributors Engaged: Multiple contacts in Sao Paulo, Brazil.

Local Contacts Consulted: Sales director at credit card company and consumer credit card consultant in Sao Paulo, Brazil.

Turnaround Time: Two weeks, follow-up within days of subsequent client requests.

Summary Answers: Existing providers are restructuring their offerings, including offering access to an array of insurance options along with credit. Due to government regulations, firms are creating their own banks instead of solely partnering with existing banks. A lack of consumer credit options is driving demand in branded retail credit offerings, with a strong interest in long payback periods.

Outcome: Foglamp information used to define internal investment thesis.