Central Bank President Minimizes Bank Resistance and Advocates Payments via WhatsApp and Google in Brazil

Roberto Campos Neto said in an interview that banks will have access to a population more banking with technological innovations

Central Bank President Minimizes Bank Resistance and Advocates Payments via WhatsApp and Google in BrazilNOTÍCIAS

The president of the Brazilian Central Bank, Roberto Campos Neto, minimized on Monday the resistance of traditional banks to the innovative systems launched by the Central Bank, PIX and Open Banking, which should have a profound impact on the sector.

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PIX opened registration on Monday, with over 3.5 million keys registered by the end of the first day. In the interview, he acknowledged that the Central Bank had anticipated the processes for launching the new system due to the crisis:

“One of the main characteristics of this crisis is that the recovery would be induced by a movement of acceleration in technological innovations, so we decided not only not to postpone this agenda, but to accelerate. We had to anticipate the process”.

He went on to say that the official forecast for the PIX was for 2023, but anticipation led to tests starting already this week. However, it will not be fully operational until 2022:

“The first time we talked about instant payments, the date proposed [by the team] was 2023. I wanted it for 2020. Then we looked at the platform, the technology part, and what it needed to make it work. We couldn’t put all the features in at once. So we set it at 2022″.

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Open Banking should be launched next year, allowing the same user to aggregate all their financial accounts on a single platform, taking away the information exclusivity of the banking institutions. It is in this sector that the president of the Central Bank says he has met more resistance, but the potential for banking seems to have convinced the banking sector:

“With respect to open banking, there was more resistance to governance, larger banks wanted more governance because they had more market share. We don’t think that this is a zero-sum game, that when one grows the other decreases, we think that this is a game where everyone grows and we begin to have segmentation. Banking will increase a lot”.

He goes on to say that the pandemic has led the government to access 40 million people who were being banked, and that in the end the innovations should make banks have “a much bigger piece” of the national banking market.

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He concluded by saying that big techs’ initiatives in the payments sector are very welcome and that the Central Bank wants giants like WhatsApp and Google to bring their payment systems to Brazil:

“WhatsApp Pay, Google Pay, and other platforms are all very healthy. We want them to come to Brazil. WhatsApp should start operating the first part, which is P2P [transfers], soon. We want Google to come too and PayPal to do more business in the country. Our interest is not to stop any movement, it is to make it have competition”.