- With millions of people worldwide having to change the way they live and pay for things, the adoption of instant payment methods and digital wallets has risen to historic highs in many countries;
- In Brazil, the tipping point came with the launch of PIX, the instant payment system controlled by the Central Bank, in November.
A new report by ACI Worldwide and GlobalData shows that over 70.3 billion real-time payment transactions were processed globally in 2020, a 41% increase compared to 2019. Brazil and Mexico appear among the top 10 instant payments markets, with 1.3 billion transactions and 942 million transactions, respectively, made last year.
The COVID-19 pandemic certainly drove these numbers. With millions of people worldwide having to change the way they live (and pay for things), the adoption of instant payment methods and digital wallets has risen to historic highs in many countries.
In Brazil, the tipping point came with the launch of PIX, the instant payment system controlled by the Central Bank, in November. The transactions recorded in the first two months of the system’s operations, combined with the increase in digital wallets’ adoption by Brazilians, led to a 58% jump in the country’s number of such payments. These transactions’ financial volume has also increased considerably, from $1.4 trillion in 2019 to $1.66 trillion last year.
“This strong growth [in instant transactions] is expected to continue through 2025, at a five-year CAGR of 25.3%,” says the report. ACI Worldwide forecasts that in 2025 Brazil will reach a volume of 4.1 billion real-time payments, with electronic transactions accounting for almost 30% of the total and instant transactions responding for 67.6%. It’s a huge bet in a country where payments in cash are still prevalent.
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PIX works on a 24/7/365 basis, with real-time clearing and settlement, and supports a wide range of payments: P2P, C2B, B2B, C2G, G2C, B2G, and G2B. Users can make transfers through various channels by using a recipient’s account number, the so-called PIX key (users’ mobile number, tax ID, or email), or by scanning a QR code.
In Mexico, Cobro Digital (CoDi)’s usage, the country’s instant payments platform, wasn’t exactly boosted by COVID-19 – the pandemic itself crushed the expectations around the first phases of CoDi, focused on in-person transactions. The structure behind CoDi is SPEI, Mexico’s real-time gross settlements payments system launched in 2004 and used mostly for transactions between banks and companies. But the thing is, making a transaction via SPEI is much more complicated (even boring) than via CoDi. That’s why the future of real-time payments in the country is really on the platform launched in 2019.
READ ALSO: Brazilian e-commerce will never be the same after PIX
In December, a survey by Banxico, the country’s Central Bank, found that 4% of the population used SPEI versus 0.5% pre-pandemic; and almost 1% of Mexicans are now using CoDi compared to minimal measurable usage previously.
In 2025, ACI Worldwide projects that Mexico will register more than 1.7 billion instant transactions, with an annual growth of 12.4% until then.
While peer-to-peer (P2P) and consumer-to-business (C2B) transactions answer for the major part of the current volume of real-time payments in the 48 markets studied by ACI Worldwide and GlobalData, business-to-business (B2B) solutions are promised to drive a much higher volume of payments in the next years. The development of e-commerce is also expected to accelerate instant payments in Latin America in the coming years – the region is the fastest-growing in this sector today.
