After less than two weeks from its launch in Brazil, WhatsApp’s digital payments offering was suspended by the Central Bank of the country. According to Bloomberg, the decision aims to “preserve an adequate competitive environment, that ensures the functioning of a payment system that’s interchangeable, fast, secure, transparent, open, and cheap”. Moreover, the bank authorities requested Mastercard and Visa to stop payment and money transfer activities through the app, adding that the companies could face fines if they don’t comply.
The decision is an impediment for Facebook, which struggled to introduce WhatsApp’s payments system in Brazil in June 2020 after testing it over the past two years in India and Mexico. Central Bank’s decision surprised the company, as the two sides were in regular contact in the run-up to the payments launch.
Furthermore, Brazil’s Central Bank stated that the suspension will let it evaluate any possible risk to the country’s system of payments, and to determine whether the payments system meets the necessary rules, as starting the service without the regulator’s approval could generate damage, especially regarding issues such as competition, efficiency, and data privacy, Bloomberg reported.
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