By expanding PIX in LATAM, the partnership ensures that more individuals and businesses gain access to instant payments. Even more so, as per the official statement, this expansion provides PIX users with solutions to a series of problems that cross-border payments entail.
For instance, the platform allows for instant currency conversion. Also, the transactions made are secure and traceable and the new offering provides a lower Financial Transactions Tax (IOF) of only 0.38%. This is significantly lower than the 5.38% applied for credit card purchases.
Apart from ensuring convenience to Brazilians travelling abroad, the new solution is expected to be easily adopted by consumers and businesses in the region, as it is cost-saving for both merchants and buyers.
The news of the expansion of PIX to other countries in LATAM reflects the larger trend that characterises the region. Currently, the digital economy and ecommerce space in the area has reached a zenith.
Even though a veer towards digitalisation was clear even before the pandemic, its onset acted as a catalyst. If prior to 2017 only 51% of the population in the region had a bank account, now the percentage rose to over 80%.
Because of this shift in digitalisation, access to digital services and ecommerce grew significantly. Another factor that boosts ecommerce penetration in the area is the fact that Latin Americans are open to shopping experiences as well as to adopting new payment methods.
As a global financial technology provider, Inswitch enables businesses to rapidly deploy their digital financial services. The company does so by leveraging its API-based platform. The go-to-market strategy Inswitch facilitates is possible because of its global network for financial operations that includes payments, banking, debit and credit cards, and issuance.
This partnership that aims to provide services to LATAM is not the first of this kind for Inswitch. In 2022, the company partnered Mastercard and, thus, gained the right to issue cards as Mastercard in Mexico.
Also in 2022, Inswitch partnered Binance to launch on-off ramp services amid a rapid cryptocurrency adoption in the region. As a result of this common venture, users were able to convert fiat currencies as well as digital assets via their Binance wallets.
Banco Rendimento is a bank that primarily focuses on offering foreign exchange, credit and payment solutions. The financial institution also provides consulting services.
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