Brazil’s central bank has approved WhatsApp Pay, which uses Visa and Mastercard accounts.
The approval is part of a plan to increase competition in the financial system through technology. In Brazil’s banking sector, the five biggest players account for almost 80% of lending and own brokerages and insurance companies.
Central bank president Roberto Campos Neto has repeatedly said that data processing is becoming more important than financial services, and that big technology companies will probably foster enough competition to reduce concentration.
Even so, the approval of WhatsApp Pay hit some roadblocks. The company announced the service in August, but the central bank quickly suspended it, saying that any service with potentially 120mn clients from the start needed thorough evaluation.
At the same time, the institution was releasing its own instant payment service, PIX, and concerns emerged that the services could clash.
The approval enables instant direct or pre-paid transactions among WhatsApp users who register Visa or Mastercard accounts.
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