Taking the pulse of Brazil's payments landscape – exclusive interview with Bexs Banco

As the ecommerce sector displays continuous growth in Brazil, what are the key trends to consider in terms of payment methods in 2021? 

In 2020, the need for social isolation made online shopping even more popular in Brazil. The Ebit | Nielsen and Bexs 43rd Webshoppers study showed a 41% growth for ecommerce revenues in 2020, indicating that the segment had an incredible year. Moreover, the same study showed a gain of more than 13 million new e-shoppers and a 76% growth in cross-border ecommerce revenues. The share of ecommerce in retail also doubled from 5 to 10%, but it still shows that Brazil is far behind countries where online commerce is more consolidated, such as China and the UK, showing that there is still a wide ‘blue ocean’ to be explored. Finally, mobile ecommerce reached 52.5% of the total online sales revenues, compared to 41.8% in 2019. 

2020 was a milestone for the entire digital industry, and it also impacted positively the payment ecosystem in Brazil. As one of the steps for consolidating the Open Banking concept, in November 2020 Pix was introduced. This instant payment tool developed by the Central Bank of Brazil (BCB), in a surprisingly short time, has consolidated itself among Brazilians, due to its immediacy and competitive cost. Today more than 102 million people are using this contactless payment, leaving behind more traditional alternative payment methods, such as debit, boleto, and online bank transfers. Pix has already established itself as the preferred alternative payment method and is also being introduced in the ecommerce environment in QR code format, where it has great potential due to the large user base already conquered. 

Pix's impressive numbers along with the inclusion of other digital payments methods, such as e-wallets to be used together with bank accounts, show a changing trend in the payment ecosystem in Brazil, which digital players should consider, in order to take advantage of this opportunity for greater consolidation in retail and sales increase. 

What determined this massive product adoption, and how did the country's payments landscape change as a result? 

Since its implementation, Pix is making banking and consumer interactions more inclusive and far more significant – according to the Central Bank of Brazil (BCB), 8 out of 10 transfers are already made using it. Brazilians are one of the most enthusiastic populations when it comes to innovation, and they like to experience all the practicality that this new technology offers. 

There are already almost 300 million Pix keys registered by both individuals and companies, revealing the consolidation of this method which benefits the entire payment ecosystem, including payers and payees. 

For those who are paying, Pix is free, instant, user-friendly, contactless, in addition to being available 24/7 and payment confirmation happening within 10 seconds. For companies accepting Pix, it has a much more competitive cost than credit and debit cards or boleto processing fees. Moreover, it is an inclusive payment method for the unbanked population (around ¼ in Brazil) who do not have access to financial products, so it is a way to access this base of e-shoppers. Another important aspect is the fact that store owners receive the purchase confirmation instantly, which mitigates order cancellations and stock blocking due to delays with boleto confirmations. Pix offers instant purchase settlement, unlike credit and debit cards, which can take up to 45 days to be settled, a hindrance for many retailers. 

The Central Bank of Brazil has an agenda for new Pix features, promising to make life even easier for companies and consumers. Pix Cobrança will ensure that retailers and service providers can generate a QR code that expires on a future date. Until then, the only option is immediate payment. As with a boleto, it will be possible to include fines, interest, and discounts. In addition, Saque Pix is also planned, which will allow users to transfer money to registered physical stores and make the withdrawal on the spot. This feature aims to provide greater access to withdrawal locations and to generate movement in registered stores. Other new features are planned on the BCB agenda, such as instalments via Pix, as well as international Pix, which is still under analysis. In parallel with the agenda, the BCB works hard to identify possible vulnerabilities of the tool, in order to mitigate fraud and make Pix the safest payment method in Brazil. 

In June 2021, Bexs Banco announced the rollout of a new solution that integrates international businesses with Pix, so that international merchants can offer this new and successful payment method. What are the main perspectives and opportunities presented by Pix for companies that join this payment system? 

While international Pix is still not an available option implemented by the Central Bank, we created a way to link the tool to cross-border transactions, complying with the limits set by such a regulatory body, but providing more flexibility to payers and payees. Bexs’ solution allows Pix to be integrated into all payment flows. Ecommerce brands can offer it as one of their payment methods at checkout (payin), and it is also possible to make payout transactions for Brazilian recipients via Pix, to pay suppliers, influencers, media, copyrights, freelancers, employees, among others. 

This legislation allows foreign exchange transactions to be made and to determine the exchange rate on the next working day once it is registered in the Central Bank’s system. It is possible to settle the transaction amount in reais on any day and at any time, which is one of Pix’s features. Bexs has reached exponential growth, surpassing the one million daily transactions mark processing Pix for companies such as TikTok, Avenue Securities, Thunes, among others. 

The data mentioned shows that Pix has become the most inclusive payment method in Brazil, so businesses should be quick to follow this trend, in order to reach more than 100 million users. Bexs’ solution enables international businesses to offer Pix to their customers, ensuring convenience and a smooth experience, without the need to set up a legal entity in Brazil. 

What further changes can be foreseen for the payments sector in Brazil? How about Bexs Banco’s roadmap? 

The payment ecosystem in Brazil is experiencing a time of great changes, more digitisation, and capillarity. Until recently, it was an extremely concentrated market in just a handful of institutions, but with legislation, progress, and modernisation of the financial system led by the BCB, there has been a financial democratisation. With the arrival of new players and fintechs, there is greater availability for smoother and more convenient services for customers. The introduction of the Open Banking concept in Brazil also contributes to greater opportunities for this market. 

The payments market tends to offer more digital solutions and opportunities to individuals and companies that are already in the financial system, and more importantly, to integrate the unbanked, who now have alternative ways to be part of the financial system – and have access to payment and credit products that were once unavailable for them. 

We are members of the committee in the Central Bank to define the future and new features of Pix, and we are always looking for bold ways to optimise the implemented tools and make them available for our clients and their users. From a wider perspective, Open Banking will empower consumers, who will benefit from a wider range of financial service providers and alternatives. 

Given the regulatory evolution scenario focused on customer benefits, our goal each day is to bring innovation and technology that has true value to consumers through payment transactions, to expand Brazilians’ access to global goods and services. We work tirelessly for this purpose. 

About Luiz Henrique Didier Jr. 

With over 25 years of experience in leading financial institutions in Brazil, Didier’s fields of expertise include innovation in payment processing, marketing, product and business development, and Brazilian foreign exchange regulations. At Bexs Bank, his main challenge is to bring innovation and technology to facilitate, through payment transactions, access to global goods and services for Brazilians and the best Brazilian goods and services for the world. 

About Bexs Banco 

Bexs Banco is specialised in international payments processing and FX transactions for global ecommerce, SaaS, and investments. Through a unique API platform, our solution provides the collection of Brazilian currency via local payment methods, helping both big and small companies to connect with customers in the digital world and to expand their customer base geographically.