The Central Bank of launched an instant platform on Monday that will speed up and simplify transactions, promote competition in the industry and attract new players such as large technology companies Facebook and .

The state-owned instant payment is called , which enables and companies to send money 24 hours a day, 7 days a week, without the need for debit or credit cards. Individuals are also free.

Central Bank Governor Roberto Campos Neto said at a virtual press conference: “The payment methods are undergoing tremendous changes. Society needs things that are fast, cheap, safe, transparent and open.”

This move by the Central Bank of Brazil aims to increase competition in a highly concentrated banking system, where the top five banks (such as Itau Unibanco Holding SA and Banco Santander Brasil SA) hold approximately 80% of total assets and deposits.

As the central bank sets lower prices for transfers and payments through Pix, regulators believe that competition will intensify. Itau’s card processor Rede said Monday that it will not charge merchants who use Pix for the first six months.

Consulting firm Oliver Wyman said in a recent study that by 2030, Pix may account for 22% of Brazilian electronic payments. Last year, Brazilian debit card payments totaled US$1.8 trillion (approximately Rs 24,75,900 crore).

Pix will cause the bank to lose some fees for personal use.

Campos Neto said that the platform was put into use at 09:30 AM local time on Monday (6:00 pm Monday, U.S. Standard Time) and can be used to buy anything from ice cream to cars.

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According to the Central Bank, the service has opened 72 million registrations, 30 million individuals and 1.8 million businesses.

Campos Neto also said that the central bank is negotiating with large technology companies such as Google and Facebook to enter the Brazilian payment service market.

“WhatsApp is about to start P2P. I have had a lot of conversations with their CEO and we are making good progress. He told me that the process of working with us is faster than other countries,” Campos Neto said.

Campos Netto said: “Our only concern is that we have to pass all approval standards and we have a system to promote competition.”

About 750 companies have signed the Pix agreement, accepting and offering instant payments. Uber said it started accepting Pix payments, hoping to increase customers who have not opened an account.

In the future, Pix will add new features, such as cash back and pre-programmed payments, which are currently mainly provided through credit cards.

© Thomson Reuters 2020

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