The Deposit BaseNarrow moat

Deposits are the quiet foundation of the whole financial operating system. By the end of 2025 Stone held about R$11 billion of client deposits, growing more than a quarter¹ year over year, and that pool matters for a reason every banker understands: it is cheap, sticky funding. A business built on advancing merchants their receivables and lending them working capital needs money to lend, and money raised from your own customers' balances is far cheaper than money borrowed in Brazil's expensive wholesale markets.

The strategic beauty is the loop. Payments bring the merchant; the merchant's takings become deposits; the deposits fund credit; the credit deepens the relationship, which brings more deposits. It is the classic spread business — gather funds cheaply, deploy them at a higher return — and it is exactly how banks have earned durable profits for generations. Stone is assembling that machine on top of a customer base the big banks neglected.

But deposits in a fintech are less loyal than deposits in a century-old bank with a branch on every corner, and that is the catch. A small merchant's balance can move to Nubank or Mercado Pago with a few taps if the app is better or the yield is higher, and Brazil's high interest rates make depositors more yield-sensitive, not less. The base is also young; it has not been tested through a real crisis of confidence. Stone must keep earning the balances by being useful and trusted, because in digital banking the deposit that arrived easily can leave just as easily. Held, though, this funding pool is what turns a payments company into something that can lend at a profit.