Pix, Brazil’s instant payments system, which garnered more than 160 million users since its launch in 2020, is going global.
At the Group of 20 Nations meeting in Sao Paulo this week, Brazil’s central bank has been pushing ideas to make cross-border payments faster and cheaper, with Pix at the forefront. The central bank is reportedly seeking opportunities for Pix to interact with foreign platforms, with Italy being one example of a nation showing interest in developing a bilateral agreement.
An Immediate Success
Pix has experienced rapid and dramatic growth, crossing four million monthly transactions as of October 2023. It now surpasses credit and debit cards as Brazil’s preferred payment method, handling more than $400 billion monthly, according to Ebanx, a Brazilian fintech company. The system is expected to account for 40% of online payments made in Brazil by 2026. Last year, Roberto Campos Neto, head of Brazil’s central bank, predicted that the country’s open finance system would soon lead to the elimination of credit cards.
Pix has revolutionized payment methods in Latin America. Instant payments have been rising by 55% annually, according to 2023 data compiled by Ebanx. Several countries, including Argentina, Bolivia, Mexico, El Salvador, Peru, and Costa Rica, have introduced some form of instant payment, hoping to replicate Brazil’s success.
One model for extending Pix is Nexus, developed by the Bank of International Settlements. This platform intends to facilitate instant cross-border transactions and is currently being tested in five Asian countries. Brazil’s central bank describes Nexus as a “promising path” for Pix to gain global scale beyond bilateral agreements.
A Model of Simplicity
Pix allows customers to transfer money instantly to a bank account or digital wallet, 24/7, and without incurring fees. Maxnaun Gutierrez, Head of Individuals and Products at Brazil’s CB Bank, explained to PaymentsJournal how the process works.
“Imagine that a friend has paid for dinner, and you need to pay him back,” Gutierrez wrote. “Instead of asking for all his bank details (account number, branch number, full name etc.), all you need to ask is: what is your Pix code? All your friend will need to do is give you one of the following pieces of information: his cell phone number, his individual tax identification number (known as a CPF in Brazil), his e-mail, or a random number generated by the system.
“When it comes time to pay for a product, a consumer can open their cell phone, scan a QR Code, and make payment in a few seconds, since all the information about the purchase will appear automatically on the screen of their phone.”
