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Brazilians would make more bank transfers if they were free of charge

A new survey made by Opinion Box for PayPal shows that PIX has everything to attract users right from its start, but most of them don't know the new system yet

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  • 3,024 Brazilians over 18 years of age in the five regions of the country (53% women) of all income classes were surveyed;
  • About 27% of them say that they normally choose to withdraw the money and hand it over personally to avoid paying transfer fees.

More than 3/4 of the Brazilians interviewed for a new survey made by the Opinion Box and ordered by PayPal say they would make more bank transfers if they were free of charge. Moreover, around 60% experienced uncomfortable situations regarding making payments, and the fact that they need to wait until the next business day to make a bank transfer is the most common problem. All these problems are, precisely, what PIX (Brazil’s instant payment system which will be officially launched on November 16th) is trying to solve, offering payments and bank transfers between individuals free of charge, and 24/7.

According to the survey, entitled Digital Payments Trends: Pix and Open Banking, 61% of the people interviewed don’t like making transfers in the current models available (TED, a type of transaction done faster, but more expensive and during the business hours of the institutions, and DOC, a type of transaction compensated during the night, and therefore, cheaper). Additionally, 57% of them say that they usually ask which bank the transfer will be made before making the payment – that’s because transfers within the same bank may not be charged or have a lower fee.

READ ALSO: Bad timing and cultural attachment to cash: Why hasn’t CoDi, Mexico’s instant payment system, taken off yet?

Meanwhile, 77% of the people interviewed say that they do not like having to wait two business days for the validation of a boleto bancário (a type of cash voucher or bank slip through which Brazilians pay their bills and make purchases), for example; and 72% do not like waiting until a payment is approved.

The survey remotely listened to 3,024 Brazilians over 18 years of age in the five regions of the country (53% women) of all income classes. The interviews, carried out using a standard questionnaire with 66 questions, were conducted between 7 and October 14, 2020.

“Both PIX and open banking are platforms that can bring a wide range of new products and services to Brazilians – based on lower costs, more availability, and less bureaucracy daily. The Opinion Box survey demonstrates, however, that there is a long journey ahead in terms of winning over this client/account holder, who does not yet have all the information available to decide whether or not to use these new features, ”said Carlos Nomura, Head of Payments at PayPal for Latin America in a press statement.

READ ALSO: Brazilian e-commerce will never be the same after PIX

Withdraw money to avoid paying fees

Also according to the study, about 27% of those interviewed choose to withdraw the money and hand it over personally to avoid paying the transfer fees charged by the banks. Another 22% prefer to deliver the money in person to avoid having to wait for the payment confirmation time.

Meanwhile, around 60% of the Brazilians surveyed experienced some uncomfortable situation “always” or “almost always” regarding making payments, and the fact that they need to wait until the next business day to make a bank transfer is the most common problem (36% cited not being able to carry out the operation on the weekend and 35% complained about business hours).

They were also asked about how much the current payment methods are part of their lives: boleto is still used by about 52% of people, while 48% use bank transfers daily.

PIX is still unknown

Despite having everything to attract users, PIX, the country’s new instant payments system, is not well-known yet. Only 15% of the people interviewed say they know PIX well; 8% have never heard of the system; 28% have heard of it, but do not know what it is, and 49% said they know a little about it.

READ ALSO: Contactless payment triples in Brazil with COVID-19 pandemic, says Visa

More than half (59%) of the Brazilians interviewed consider PIX to be safe. For 66%, the Brazilian Central Bank’s payment system is easy to understand; and 72% said they were likely to use it daily.

When informed about the potential gratuity of the platform for sending money between individuals, the rate of respondents who would use it rose to 80%.

32% of those interviewed by Opinion Box said they intended to replace transfers in general, and boleto bancário with the new tool; 8% said they would continue to use only DOC, TED, and boleto; and 60% of those surveyed said will use a mix of them.

22% have never heard of open banking

On the next 30th of November, another regulatory novelty comes into force in Brazil: open banking. Through it, consumers will be able to share their data with different financial institutions, through a platform that integrates and standardizes banking and fintech applications, bringing more transparency in the relationship with financial institutions, in addition to allowing healthier competition between companies.

READ ALSO: On the first day of trials, PIX records more than 1,500 transactions, says Brazilian Central Bank

This new tool was also a target of the survey by Opinion Box/PayPal: 77% of the respondents say they normally look for banks that can offer different rates, ensuring the best cost-benefit ratio; and 65% would like to have all their financial data centralized in one place.

It is very interesting to see that, although Brazilians do not know this, both PIX and open banking have great potential to solve real consumer problems. The challenge now is to make the two themes better known

FELIPE SCHEPERS, COO OF OPINION BOX.

Also, 26% say they have difficulty controlling finances because they have to check accounts at several banks. According to the survey, just over half (53%) of consumers have already had difficulty obtaining credit at a bank, while 50% have already given up changing their financial institution because of bureaucracy; and 45%, gave up for not reaching the same credit limits as they currently have.

READ ALSO: Brazil’s instant payments system, PIX has everything to boost the world’s biggest financial inclusion process

Ironically, half of the interviewed people have never heard of open banking, and only 22% say they “know a bit” or “know well” the tool that can help to solve all these problems.

After being informed about open banking, 45% of the respondents understood how it works and 35% said they were confident about using this functionality. But only 34% would authorize their data to be shared with other financial institutions.

Among those who would authorize data sharing, 30% would do so because it would benefit them; 25% because they believe this would make it easier to obtain credit from other financial institutions, and 19% because they could opt for cheaper banking services.

READ ALSO: Founded by Swedes and Brazil-based, FinanZero is counting on open banking regulation to boost its consumer loans demand

Among those who are not interested in sharing their data (24% of the total), the main reasons for this are: “I worry about who will have access to my data”, with 50%; “I don’t think my banking history should be shared”, with 20%; “I believe that only I should have access to my financial data”, with another 20%; and “I am afraid that my banking history will harm me in other banks”, cited by 10% of respondents.

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