The Central Bank of Brazil launched yesterday (19 February) the official instant payments system brand, named Pix. The new system will enable immediate transactions, such as money transfers and payments – including bills – within up to ten seconds. All financial institutions with over 500,000 accounts must adopt the system before November 16th, when the system will effectively be launched. The participation is voluntary for entities that haven’t yet reached this number.
With Pix, clients from financial institutions will be able to complete transactions within a few seconds, 24h a day, 7 days a week, including holidays – different from TED and DOC transactions.
Not only are transactions faster, but the main difference between Pix and services offered by cloud payment platforms, such as e-wallets, is integration, as all market players will be able to adopt the system.
Learn how Pix will work
Peer-to-peer money transfers, bills and boleto payments, taxes and services fees (such as passport issuing, for instance) are among the operations that will be made possible by the Central Bank of Brazil’s instant payment system.
“The project will be the embryo of what I believe is a total transformation in the country’s future financial intermediation, and will consolidate what we understand as the new form of payment methods, with the new fintech industry and with open banking “, stated Roberto Campos Neto, President of the Central Bank of Brazil.
Pix payments will be enabled through:
• QR Codes;
• Address keys;
• Filling in the information manually;
• Proximity payments.
Details about the two first options were shared at the press conference.
To complete a purchase with a QR Code, users will simply access their institution’s app and click on the instant payment option, shown as Pix. The user then defines if he will complete or receive the payment and scans the static or dynamic QR Code created by the receiver. The receiver’s data will be exhibited on the smartphone screen and the user confirms the transaction.
Payments with address keys occur in a similar way. However, instead of scanning the QR Code, the user selects the type of address key in order to identify the receiver – either a mobile phone number, e-mail or CPF or CNPJ, the individual or company’s fiscal number. Like with QR Codes, the receiver’s data appears in the smartphone’s screen for confirmation.
During the launch, the Central Bank of Brazil’s Director of its Financial System and Resolution Organization, João Manoel Pinho de Mello, clarified that the payment solutions will be developed by private market players, and the Central Bank of Brazil will not develop a specific app for Pix. “What the Central Bank of Brazil will provide as a public utility service is the settlement of the transaction and addressing basis”, said Mello.
Pix in ecommerce
Pix will also change the reality of ecommerce businesses in Brazil. The payment journey will be the same as in-store payments: customers simply select the Pix option at the checkout page, open their financial institution’s app and follow the steps.
Because the settlement occurs within an instant, the order is confirmed the same day and should be delivered quickly.
The unbanked Brazilian populations, that today represents over 45 million adults, according to the Locomotiva Institute, will also be encouraged to be included in the financial system.
“The potential is huge. The fact that there has already been great inclusion from small businesses with card payment methods enhancements suggests that, with Pix, this inclusion will be even higher,” said Mello.
Want to learn more? Access the full announcement in the Central Bank of Brazil’s YouTube Channel (in Portuguese).