Europe wants to boost immediate transfers that will multiply continental trade capacity. The instant payment system PIX is used in countries, including Brazil, and has seen a 70 per cent increase in transactions.
The Central Bank of Brazil launched PIX in 2020, an instant payment method that has improved the banking usage of the Brazilian population. It already has more than 100 million users in Brazil, and it has surpassed bank cards in e-commerce.
The European Commission wants to boost trade between continental merchants by implementing immediate transfers. This is something that can already be done depending on the country and the bank and, in case of Spain it has had success through Bizum.
Europe aims that all banks in the European Economic Area adopt immediate transfers to improve commercial transactions. This model aims to be the future and is already present in large foreign economies, such as Brazil’s. According to experts, it is being implemented in all Latin America with great results.
Brazil developed PIX a couple of years ago. It has been so successful that its ‘twins’ are already expected to expand to the US and Colombia. In Brazil, it is already the leading method, and the US and Colombia will copy it. This payment method allows instant transfers and is used daily by both companies and citizens. According to data from Deloitte, the number of mobile transactions in 2020 has grown by more than 70 per cent.
Focus on Brazil
“Countries such as Brazil have made significant progress in immediate payments. PIX is an example of this, which has been an exponential case and it has completely changed the transfer system situation in the country, leaving much room for growth in the market and continuing to provide improvements and opportunities to merchants seeking market expansion,” says Daniel Pimentel, country manager for Brazil at PayRetailers.
Brazil, despite its differences with Europe, is experiencing a similar economic trend. This is especially true for e-Commerce, the future of large-scale commerce. Seventy per cent of the Brazilian population use online services. In addition, the latest data shows that more than 80 per cent of the population has access to banking services.
This outlook is seen among experts as ‘optimistic and positive’ with financial security becoming more and more important. Europe, for example, has an e-commerce of about 75 per cent, according to the European e-commerce report.
“The Brazilian market has positioned itself as the second largest Latin American economy for Spanish business people”
Immediate payments would increase transactions and thus expand business capacity both within Europe and with Latin America. E-commerce, which in Spain has grown by 49 per cent since 2017 according to PayRetailers analysis, is one of the reasons why the European Commission is asking to implement instant transactions that reduce paperwork and multiply business.
PIX was launched in 2020 by the Central Bank of Brazil, a payment system that drove the country’s digital and economic transformation. As a result, Colombia is planning to launch its own PIX to boost instant transactions both at the corporate level and among ordinary users.
Copied by USA and Colombia
Even the US, according to The Wall Street Journal, will adopt this system with its FedNow platform.
Currently, according to the same financial institution, an average of more than 2,193 million transactions were recorded in August 2022, with more than 126 million users performing at least one transaction through PIX. This is the most widely used payment method by Brazilians, even surpassing the number of credit/debit card transactions, as it facilitates instant transfers for both individuals and businesses.
This instant payment system is processed in reais. It promotes the banking of the population, daily transactions, as well as fast and safe consumption. This is a positive scenario for entrepreneurs that could improve their growth rate, according to experts. As proof of its implementation, it has more than 100 million unique users in a country with a population of slightly more than 212 million people.
The system’s immediacy has positioned it as an effective solution for European e-commerce companies that are starting to operate in the Brazilian market, and with the help of payment platforms such as PayRetailers, this financial format is easy to integrate, making it the key element for business growth in the country.
“Latin America is modernising at an accelerated pace. And that’s why we created expert technology companies in the region that act as payment gateways to help international merchants understand each market, offering local payment solutions that allow them to navigate quickly and securely. In Latin America, and specifically in Brazil, there is a great perception of Spanish businesses,” says Pimentel.
Fraud prevention
These types of payment platforms reduce the risk of fraudulent transactions. For example, they allow you to see how a particular operation is being managed in real time. Furthermore, one of the main features is that they simplify any transactions, since the technology of these companies is responsible for the adaptation in the local currency and compliance with financial regulations.
The ease of doing business is increasing considerably. It is also among the explanations for the growth of the Brazilian international economy. Industries such as tourism see how all purchasing processes carried out by Spanish consumers are streamlined. Besides, large companies in market niches that move millions, such as machinery or fuels, are reinforcing the security of all their operations with Brazil.
Brazil, the second largest economy
The Brazilian market has positioned itself as the second largest Latin American economy for Spanish business people. Brazil accounted for 0.9 per cent of all Spanish exports between January and August of 2022. In other words, Mexico is the only country with a 1.3 per cent share of exports. Overall, Latin America accounts for 4.7 per cent between January and August of 2022.
In addition, it also has a wide range of Spanish subsidiaries. Just over 12 per cent of Spanish subsidiaries overseas are in Brazil, which in this case does exceed Mexico, and it is close to the 14 per cent of the United States, according to INE data published in 2021. In total, more than €27billion was moved during the pre-pandemic year 2019.
“Brazil is establishing itself as a potential focus for Spanish and European companies. Banking, technology settlement and the existence of payment gateways are a realistic option for business expansion,” says PayRetailers’ Pimentel.
PayRetailers is a Spanish company founded in Barcelona specialising in international transactions, with a focus on the LatAm market. As a payment gateway, PayRetailers guarantees the best local solutions for global stores to connect with Brazil. Visit its website to discover the opportunities provided to large companies.
