Instant payments and instant confirmation in Brazil: PIX
If you’re doing business in Brazil, it’s hard to overstate the importance of PIX, the new instant payment system being launched by Brazil’s national bank on November 16th. To give an idea of the scale of the impact – PIX will open up online purchasing to the 45 million Brazilians currently without any form of a bank account. 25 million consumers have already signed up for PIX – before it has even launched.
PIX will be integrated into PrimeiroPay from Day 1
Luckily, if you’re a PrimeiroPay client, you’re good to go – we have already integrated PIX into our payment platform. Your Brazilian customers will be able to pay via PIX as soon as the system launches next week. With our new hybrid Boleto/PIX model, you can offer your Brazilian shoppers greater choice and flexibility.
When they choose to pay with Boleto, PrimeiroPay will generate a Boleto voucher with a bar code as usual, and also create a PIX QR Code. The shopper can then choose which payment method they prefer to use. If they use PIX, the payment will go through immediately. If they go with Boleto, it can take at least 1 hour, and up to 3 days, to verify the payment.
This hybrid option is a great way to inform your shoppers about PIX, which we see as a win-win for both parties – your customers finally have access to a fast, effortless and 100% digital payment method, and you receive payment more quickly and can ship orders more efficiently. All of this with no extra integration efforts from your end, the option will be available on our platform.
What are the benefits of PIX for merchants selling in Brazil?
It’s definitely worth promoting the use of PIX with your customers, as the advantages of PIX over the alternative methods currently available in Brazil are clear:
- Unlike Boletos, PIX is available 24/7, 365 days of the year. Refunds can be automated, and payment is received instantly.
- PIX is also significantly faster than Boletos, which can take up to 72 hours to process. And it’s all done on the shopper’s phone, making the purchasing processing far more seamless.
- PIX is far less effort than bank transfers (DOC and TED); customers don’t need to put in detailed information, just their QR code.
- PIX offers shoppers an easier, cheaper way to pay online, and doesn’t require merchants to integrate any additional software into their online checkouts.
What is PIX, anyway?
If you missed the headlines, here’s a quick summary for you:
- PIX is the first instant payment system available to Brazilian consumers, developed by the Central Bank of Brazil.
- With instant payments, funds are transferred in real-time from the customer’s account to the payee, without the usual delays involved in bank transfers, credit card payments and other methods.
- PIX is a safe and secure option, which is free for consumers, and low cost for merchants. It is also more convenient – there’s no need for cash, credit cards or POS machines, just a smartphone.
- PIX offers major advantages to merchants too. Funds are available instantly, making cash flow easier to manage. Acceptance costs are low, and all transactions can be handled online.
- Unlike Boletos, refunds are easily automated with PIX. If a customer requests a refund, the merchant can simply log into the PrimeiroPay API and register the refund request, which will then be processed instantly and automatically, just as with a credit card transaction. With Boletos, the request will need to go through support and will involve requiring detailed information from the customer.
- Currently, 30% of the Brazilian population have no bank account and rely on cash or Boletos, a cash-based method used in up to 25% of all online transactions in Brazil. The Central Bank of Brazil is optimistic that PIX will encourage the millions of unbanked Brazilians to access digital banking tools. In the future, you won’t need a bank account to use PIX, meaning that PIX opens up instant online purchasing to a huge untapped market in Brazil.
- PIX also provides a useful alternative for debit cards. Debit cards are popular with Brazilian consumers, with over 116 million currently in use. However, Brazilian shoppers tend to use them for in-person purchases, rather than online transactions – both because they are not always accepted by Brazilian ecommerce sites, and because they are perceived as less secure than credit cards.
How does PIX work?
PIX enables customers to send instant payments to the recipient, using one of three methods:
- A QR code;
- An “address key” alias, such as a mobile phone number, email address or taxpayer ID;
- Information exchange technologies, such as Near-Field Communication (NFC).
The PIX user will then register their access code directly with their financial institution or digital wallet. All financial institutions and fintech companies with over 500,000 active accounts are required to offer PIX in Brazil. PIX is being touted as a revolutionary move forward for the Brazilian payments scene, and Brazilian consumers in general.
If you are a PrimeiroPay client, PIX will be available for you – any questions, just get in touch with your Account Manager, and you’ll be ready to go in no time. And if you’re not already working with PrimeiroPay, click here to set up a chat with one of our Payment Experts and find out how we could help you do more business in Latin America.