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Fintechs report challenges and hurry to adapt to PIX, the new Central Bank system


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Gradually the Brazilian payments market and its members are preparing for the arrival of PIX, the instant payment system under development by the Central Bank (BC). And the climate is one of optimism and expectation with its potential, at a pace that was not affected by the coronavirus pandemic.

“We noticed a concern and speed (from the BC) to get things done in 2020, even with Covid-19. They organized the schedule correctly ”, highlights Leo Monte, Sinqia's Innovation Director. The banking technology company also works with consultancy and has advised at least two of its customers in the process of joining the PIX.

“There is great pressure (from the BC) to put this on schedule this year. We are running with the guys to get it all ready in November ”, comments José de Carvalho Júnior, BPP's innovation director. Fintech focused on payment solutions for companies (the so-called B2B), it is one of the 86 institutions that requested direct membership to PIX. Having more than 500 thousand active accounts, he had to do the process in March.

Despite the rapid pace of implementation, Carvalho adds that BPP did not find it difficult to comply with technical requirements. "We already had this know-how and completed most of the tests before quarantine."

The rush to the BC was also highlighted by Tulio Iannini, CEO of U4Crypto, one of the 23 institutions that applied for membership in PIX in the indirect format. However, he points out that the process has been smooth.

“Everything is very new and all companies are in a real race to find business models to be employed. It is a moment of discoveries in an environment that does not have any mysteries, since the construction is being conducted by the Central Bank in a very transparent and democratic way ”.

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Brand of PIX, instant payment system developed by the Central Bank.
(Photo: Disclosure / Central Bank)

What to offer?

Sinqia's director notes that the degree of complexity and cost to implement the PIX vary greatly according to the size of the company. However, he mentions that the main issue noted with customers is not in relation to the technical part, but about what will be offered from the new system.

“Institutions will need to rethink their products, business models and new consumer experiences. As soon as instant remittances exist, services will also have to adapt ”.

This perception is shared by Iannini. “Our difficulty is the same as the others: finding an appropriate commercial model, in addition to promoting integration and approval within the period determined by the Central Bank”.

The standardized QR Code for transactions, one of the characteristics of the PIX, is one of the elements that should both help in the creation of new services and encourage the entry of new actors.

Despite its name, U4Crypto does not yet have services that include crypto, but awaits a regulation of the theme in Brazil to also act in this area. For the CEO of the company, it is a matter of time and the PIX is part of that process.

"In Brazil there are a number of regulatory restrictions for cryptocurrencies, but the latest measures by government agencies lead us to understand that everything will be a matter of time, as they are 'organizing the house'".

Initially blockchain technology was considered for the PIX, but ended up being left out. However, it is present at Pier, a system for exchanging financial information that the BC maintains together with the CVM (Securities and Exchange Commission) and Susep (Superintendence of Private Insurance).

PIX membership

In all, 109 companies have formally joined the new service, which aims to make a bank transaction as simple as sending a WhatsApp message. In addition to putting banking services like TED and DOC into extinction as it becomes more popular, it must also accelerate the digitalization of the financial system, reducing the use of physical means – such as banknotes and plastic cards.

The list may still grow, as June 1 is the deadline for joining the PIX before its launch, scheduled for November 16. After that date, the system will only accept new members from December 1st.

It is worth remembering that the Central Bank determined mandatory adherence to the service to all companies that fit this cut, in order to guarantee a faster standardization and popularization of the new tool.

Next steps

From June to October, the PIX homologation tests will take place with the institutions that have formalized their enrollment until the 1st of June. This phase lasts until mid-October and will define who will actually have the service available to their customers from November 16.

See below the schedule, released by the Central Bank:

  • June 1: deadline for institutions to apply for membership to PIX and participate since the launch (there will be a new opportunity from December 1);
  • June 1st to October 16th: homologation stage and completion of the registration stage (documents and information must be sent to the Competition and Market Structure Department by the BC Digital Protocol);
  • June: Disclosure of regulations on operational platforms (SPI and DICT);
  • July: PIX regulation and technical manuals released
  • November: launch of PIX to the public.

The implementation of the PIX is part of the Central Bank's plans to create a more open, competitive and innovative environment in the Brazilian market. That is, whoever best adapts to it will reap the best fruits.

The composition generated tends to benefit fintechs, which have leaner formats and are adaptable to major technological changes. The arrival of the instant payment model should also facilitate the entry of new players in the system, which can break the concentration that is prevalent in the market today.

In addition to the PIX, two other issues that are affecting the financial market in the country this year are Open Banking and the Regulatory Sandbox, both with the BC and CVM (Securities and Exchange Commission).

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