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Brazilian card industry recovers and sees digital purchases grow 31.4%

From January to September, remote transactions generated BRL 307 billion, according to Abecs. The sector's digitization surpasses pre-pandemic levels

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The amount generated by digital card purchases and other methods, such as digital wallets, grew 49.3% in the third quarter of 2020 in Brazil, to BRL 126.2 billion. This year, from January to September, the so-called card-not-present transactions increased by 31.4% over the same period last year, to almost BRL 307 billion, according to data released this Tuesday by Abecs, the association that represents the electronic payment sector in the country.

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The industry resumed its double-digit growth in the third quarter (10%), and, in the first nine months of 2020, it generated BRL 1.38 trillion, 5.4% more than in the same period of last year. If considered the temporary impact of the COVID-19’s emergency aid on these results – that is, BRL 35.9 billion from purchases made through the social accounts of the state-owned bank Caixa Econômica Federal–, the sector’s growth this year is even higher, 8.1%.

“It’s the so-called ‘V recovery’. The country’s economy as a whole may not have had exactly this behavior, but our industry did,” said Abecs’s director, Pedro Coutinho, during a press conference.

After seeing the amount transacted plummet 15.1% in April compared to the same month last year, the electronic payment industry in Brazil began to recover in May, and ended September with a 13.5% increase over the same month of 2019.

Although credit card transactions are recovering at a slower pace, the financial volume generated by debit and prepaid cards has already exceeded the pre-pandemic level. The same is true for remote purchases, which also contributed to the Brazilian retail recovery.

Digital purchases presented an annual variation of 29.3% in February this year, reached a peak of 62.5% in July – boosted by the emergency aid payment to over 67 million people in the country –, and ended September 43.4% higher than the same month last year.

infographic about digital purchases in Brazil 2020

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Contactless payments also grew, a lot: 478.7% between January and September over the same period last year, generating a transactional volume of BRL 22.7 billion.

Coutinho believes that in 2021 the advancement in the use of the debit card, as well as payments by approximation, will be even greater, not only due to the change in consumer habits, but also because of the sector’s work to improve safety and security. users’ experience with these means of payment. Abecs estimates that the debit card has the potential to generate BRL 160 billion per year in digital commerce.

Of the BRL 198.4 billion spent via debit cards in the third quarter of this year, 12.9% came from remote transactions. And within the total universe of remote purchases, 20.3% of the volume transacted came from payments made with a debit card.

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As for the possible impact of PIX, Brazil’s instant payment system due to debut on November 16, on the card industry, Coutinho said that this “should not be a priority” for this new payment environment.

“More important than competing with debit cards, is to reduce the circulation of cash and improve the user experience, replacing the use of boleto bancário (a type of cash voucher or bank slip through which Brazilians pay their bills and make purchases) and bank transfers, and therefore reducing costs. It is the consumer who will choose what is best for him. If he understands that it’s easier to take the card out his pocket and bring it closer to the POS terminal than to take his cell phone and open the bank application to make a PIX transaction, he will do it,” stressed Coutinho, who is also CEO of Getnet, one of the five largest acquirers in Brazil, controlled by Santander.