Background on Pix and its Importance
Pix, Brazil’s instant payment system, will continue to be a publicly owned digital infrastructure developed by the country’s central bank. This decision was announced by Gabriel Galípolo, head of the governing body, emphasizing its strategic value for Brazil.
U.S. Investigation and Pix’s Role
The U.S. initiated an investigation in July regarding potential unfair business practices that could negatively impact American companies due to their influence on digital commerce and electronic payment services. Pix, launched late in 2020, has significantly transformed Brazil’s payment landscape, surpassing the combined usage of debit and credit cards in transaction numbers.
Security and Conflict of Interest
Gabriel Galípolo argued that a central bank-managed and operated instant payment system ensures security for Brazil. He further explained that if Pix were managed by a private entity, it would face conflicts of interest when deciding which new participants can join or leave the system.
“By keeping Pix as a public infrastructure within the central bank, it becomes like an open highway where anyone can travel, as long as they follow the rules of the road,” Galípolo stated.
Expansion of Financial Inclusion
Pix has broadened financial inclusion by integrating millions of previously unbanked individuals into the system. This, according to Galípolo, has ultimately expanded the customer base for credit and debit cards.
- Currently, 159 million individuals and 15 million businesses use Pix, covering approximately 90% of Brazil’s registered population and companies, as per the central bank chief.
Need for Legal and Institutional Reforms
Galípolo also highlighted the necessity of revising the legal and institutional framework of the central bank to ensure it has the required financial and budgetary capacity to support innovations.
