Stone spent years trying to prove it was more than a card-payment company. Now it is beginning to face the logical consequence of that success: the closer it gets to becoming a bank, the more it must deal with banking risk. In the second quarter, Stone reported adjusted net income of R$583 million and a 22% ROE, but its credit metrics show that the next phase of growth will be more complex than its original expansion in payments.
The shift is already visible on the balance sheet. Stone’s credit portfolio reached R$3.8 billion, up 16% from the previous quarter, while deposits rose 22% year over year to R$10.8 billion. The company has also folded Pagar.me into the Stone brand and now explicitly positions itself as “the bank for entrepreneurs.” The goal is to capture a larger share of the financial relationship with its 4.8 million clients by combining payments, banking and credit on a single platform.
There is a clear logic to the strategy. Stone’s original business remains large, but it is showing signs of maturity. Total payment volume rose just 4% year over year to R$142 billion, while adjusted gross profit was broadly flat at R$1.6 billion. Credit gives Stone a growth avenue that payments alone may no longer provide at the same pace. It also deepens the company’s relationship with small and medium-sized businesses, allowing it to generate more revenue from clients it already knows.
The price shows up on the other side of the balance sheet. Loans 15 to 90 days past due reached 6% in the quarter. Cost of risk climbed to 21.5%, while provisions rose about 13% from the first quarter to R$188 million. None of these numbers, on their own, means the strategy is flawed. But they show that banking growth introduces a variable that matters far less in pure payment processing: the quality of the borrower.
That is the key issue for investors. Stone is moving from a story driven mainly by payment volumes, customer growth and take rates to one that must also be judged on underwriting, provisions and credit costs. The success of the transformation will not be measured only by how quickly the loan book grows, but by how much return remains after losses. The larger credit becomes within the business, the more important that equation will be.
For now, returns remain strong. Consolidated ROE reached 22%, up one percentage point from a year earlier, while adjusted earnings per share rose 9%. Stone has also returned R$3.1 billion to shareholders so far this year, including about R$700 million through share buybacks. That gives the company room to absorb the expansion in credit without making the quarter look strained.
But the strategy changes the type of risk shareholders are buying. Growing payments is largely about signing more merchants and processing more transactions. Growing credit also requires getting the underwriting right: who should borrow, how much they should pay and how much should be reserved for potential losses. In a business heavily exposed to small and medium-sized companies, those decisions become increasingly important as the loan book scales.
Beyond merchant acquiring, Stone’s next test is harder: proving it can build a bank without sacrificing the returns that made its payments platform attractive in the first place. Becoming a bank opens a new source of growth. It also means that, from here on, every real lent matters as much as every real processed.
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