Home Payments ‘Pix me?’: Brazil marks one year of instant payments system

‘Pix me?’: Brazil marks one year of instant payments system

Roberto Campos Neto: ‘Pix me’, ‘Do you accept Pix?’ and ‘Want to pay with Pix?’ are "already the ‘new normal’ for most of the population” in Brazil, according to the central bank governor | Global Government Fintech screenshot

Almost two-thirds of Brazil’s adults are using state-run instant payments system ‘Pix’ to make or receive payments one year after its introduction, the country’s central bank has announced.

Banco Central do Brasil (BCB) released the latest user data during an online event to mark the first anniversary of the introduction of Pix, which was introduced as part of ‘Agenda BC#’, a central bank initiative to promote structural change across the South American country’s financial sector to keep pace with and capitalise on technological advances.

Transactions through Pix, which aims to encourage the digitisation of payments and make for a ‘better payment experience’ for Brazilians, are initiated through either what is described as an ‘alias’ (effectively a personal code that looks similar to a zip-code) or by a QR (Quick Response) code, with the BCB describing the scheme at the time of its launch as an ‘instant, low-cost, safe and intuitive’ payment method.

The scheme, which is free of charge for citizens, entered full operation in November last year across 734 organisations – for example, payment institutions, banks, fintechs, credit companies, credit unions, and saving and loans associations. There are now 762 participant organisations.

“The expressions ‘Pix me’, ‘Do you accept Pix?’, ‘Want to pay with Pix?’ are already the ‘new normal’ for most of the population,” said BCB governor Roberto Campos Neto in a press release marking last week’s milestone in which he also spoke of a payments “revolution”.

Pix: under-40s lead adoption

Across Brazil, which has a population of about 212 million people, 104.4 million – 62.4 per cent of adults – have used Pix to pay or receive payments, making it ‘already one of the most used’ payment methods in the country, according to the BCB.

The central bank said that most transactions to date have been undertaken by young people, with 34 per cent of transactions involving 20- to 29-year-olds and 31 per cent involving those aged 30- to 39-years-old (so, in total, 65 per cent of transactions involved citizens aged from 20 to 39).

There are currently 348.1 million registered ‘keys’ – codes that identify a user’s account and that can then be used to send or receive money – comprising what the BCB breaks down as: 121.2 million ‘random’ keys; 93.8 million taxpayer registration numbers (known by the acronym CPF in Portuguese); 76.1 million mobile-phone numbers; 50.6 million e-mail addresses; and 6.4 million CNPJs (short for ‘Cadastro Nacional da Pessoa Jurídica’ or ‘National Registry of Legal Entities’).

“Pix encourages electronic payments, enables business digitisation, increases market efficiency and is an important vector for promoting financial inclusion,” Campos Neto said, adding that Pix had become “especially important, enabling business, quick payments and donations” during the Covid-19 pandemic.

Pix has so far been used as a payment method by 45.6 million people who had not used pre-existing money transfer service TED (Transferência Eletrônica Disponível) in the year prior to Pix’s launch. Of this total, 33.9 million have started using Pix exclusively, according to the BCB’s data.

Pix is evolving

During its first year, new functionalities have been introduced, such as the payment of ‘due charges’ – payments made by citizens to the federal government – and ‘mandatory scheduling’ (extending Pix from instant payments to a scheduled payments).

In respect of payments to public entities, Pix is so far able to support payments including electricity bills (in some Brazilian states), as well as Guia de Recolhimento da União (GRU) payments to federal government, for example passport or legal fees.

Further services will also be introduced such as: ‘Pix Saque’ (withdrawals), which will enable any user to make a cash withdrawal at any organisation offering Pix; and ‘Pix Troco’ (exchange), effectively a cashback service where a citizen transfers a value higher than a purchase, receiving the difference in cash.

BCB is also working on new features such as ‘automatic debit’ and taking Pix international.

But it has not all been plain sailing. The BCB announced new security rules for Pix almost three month ago following a series of ‘lightning kidnappings’ where citizens were grabbed off the streets and forced to make cash transfers in order to be released. The BCB’s measures include a BRL 1000 (about £140) transfer limit between individuals between 8pm and 6am, a minimum wait-time to increase transfer limits, and the ability to set different transactional limits for daytime and nighttime, when kidnappings are more common.

The BCB’s one-year anniversary event, ‘(R)evolução Pix – 1 ano’ (video; Portuguese language; 3hr37min40sec), included panel discussions.

*** Separately in the payments sphere, the European Central Bank (ECB) yesterday (22 November) published a new framework for overseeing electronic payments (e-payments). The Eurosystem oversight framework for electronic payment instruments, schemes and arrangements (‘PISA framework’) complements forthcoming EU regulations on crypto-assets (including stablecoins) and international standards for global stablecoins. The Eurosystem comprises the ECB and central banks of the 19 European Union member states that use the euro.

FURTHER READING

=>>> Global Government Fintech’s dedicated ‘Payments’ section <==

‘Brazil central bank launches instant payments system Pix’our news story (18 Nov 2020) on the birth of Pix one year ago