Feedback: Brazilian Central Bank celebrates Pix

The Brazilian central bank (BCB) presented its instant payment scheme called Pix in November 2020. Since then, the service has proven itself and the BCB is now proudly displaying its results.

FACTS

• Pix is a free interbank transfer solution, a 100% digital payment method accessible from a cell phone and open to all Brazilian users.

• Today, its model appears to be perfectly adapted to its market, since in just one year, Pix has managed to convince some 110 million users, i.e. nearly half of the Brazilian population.

• To date, nearly 89 billion dollars have already passed through the network.

• Last July, Pix broke its own record, allowing 40 million payments to be made in a single day, most of them for transactions between individuals.

  • To continue its growth, Pix is currently working on new features:

  • a cross-border transfer service,

  • a point-of-sale cash withdrawal solution.

CHALLENGES

• Promote inclusion: Pix is establishing itself as an additional banking solution, a lever for facilitating payments to encourage Brazilians to open an account. To date, 30% of the local population does not have a bank account.

• Maintaining its hegemony: The Brazilian Central Bank's launch of Pix was a major challenge. At a time when the web giants are trying to establish themselves as payment references via their communication services or social networks, the Central Banks have the difficult task of presenting services that are adapted to digital channels, inclusive and accessible. And before the launch of Pix, BCB was under threat from WhatsApp's ambitions and Nubank's success.

• Establishing itself as an international benchmark: Brazil now has more instant transfers than the United States.

MARKET PERSPECTIVE

• The launch of PIx is a success, but the Brazilian government is also aware that it has taken advantage of a window of opportunity created by the health crisis. The use of cash at the point of sale dropped by 25% in 2020, according to a report by technology consultant FIS. At the same time, undeclared work has exploded in Brazil to account for 80% of new jobs created in the first three months of 2021.

• Yet Pix and its digital peer-to-peer payment service has naturally emerged as a perfect alternative to cash.

• The Brazilian Data Protection Authority is investigating the first PIX data leak.More than 395,000 electronic payment keys were exposed after a system failure at the state-owned bank Banese.