Technology

Mastercard forecasts Brazil's Central Bank to authorize WhatsApp payments in Q1 2021

Brazil's WhatsApp is also now allowing a shopping cart tool in conversations with business accounts

Photo: REUTERS/Rupak De Chowdhuri
  • The launch of payments via WhatsApp before PIX’s full operations could adversely affect the new Brazilian Central Bank instant payments platform;
  • Mastercard estimated that the participation of cards in shopping payments reached about 50% of household spending in the country this year.

Mastercard predicted on Tuesday that the Brazilian Central Bank may authorize the use of WhatsApp for payments in the first quarter of 2021 after the regulator’s concerns about innovation have been resolved.

“We have had weekly meetings with the Central Bank and I think we are close to the permission of WhatsApp for payments,” said the president of Mastercard for Brazil and Southern Cone, Pedro Paro Neto, in an interview with journalists, adding that he expects the endorsement for the first quarter of next year.

READ ALSO: Banco do Brasil to enable payments with PIX through WhatsApp

Brazil’s Central Bank suspended the service announced by WhatsApp in June, citing the need for it to undergo an authorization process. The model provided for the transfer of funds through the application through cards, using the existing payment systems from Visa and Mastercard.

Sources familiar with the matter pointed out that the launch of payments by WhatsApp before PIX‘s full start of operations could adversely affect the new Brazilian Central Bank instant payments platform, launched last month.

Forecasts

Paro Neto also predicted that payments with debit and credit cards in Brazil in 2021 should grow by about 16%, already considering the end of the payment of emergency aid by the federal government.

For this year, the executive forecasts an increase of around 11% over last year. The figure is less than the 18% expansion initially forecast for 2020.

“But we are happy with the balance sheet for 2020, considering everything that happened,” he said, referring to the crisis caused by the COVID-19 pandemic.

READ ALSO: WhatsApp to provide peer-to-peer payments services in Brazil soon: central bank chief

Mastercard estimated that the participation of cards in shopping payments reached about 50% of household spending in the country this year, compared to about 45% last year, given that social isolation measures have accelerated the exchange of cash for electronic methods.

As for Brazil, WhatsApp is also now allowing a shopping cart tool in conversations with business accounts, reported O Estado de São Paulo. It will allow the user to have access to the product catalog and know what to buy before starting the conversation. The idea is that, in the future, this tool will become a complete store, with payment also made within the app.

(Translated and co-written by LABS)

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