Brazilian Central Bank Cancels WhatsApp’s Payment Services
The central bank of the Latin powerhouse, Brazil, suspended WhatsApp’s payment services a week after the latest setback for Facebook. The country is the second-largest market for the technology company, making the blow even harsher.
According to a recently released statement by the bank, it made the move to preserve adequate competition in the country. Therefore, the central bank wants to ensure that the competition in mobile payment spaces has balance.
It added that it seeks to ensure a functioning payment system in the country.
Brazil’s central bank wants a cheaper, more transparent, open, and secure payment system in the country.
Technology news says that banks in Brazil have now asked Visa and Master card to suspend their transactions. Both of the aforementioned companies are among WhatsApp’s payment partners in Brazil.
If the companies fail to comply, they would be fined or given administrative sanctions.
In a recent statement from the central bank, it said that it hadn’t had any chance to analyze WhatsApp’s payment services.
Yesterday’s announcement is the latest setback for the technology giant Facebook, which recently began testing the messaging platform’s payment services.
The social media platform just started trying mobile transactions in India two years ago. And Facebook has not yet gotten any regulatory approvals from authorities, however.
Due to coronavirus, mobile payments have been in demand as people avoid physical transactions. Fortunately, modern technology has expanded the horizon for digital transactions as such.
Aside from India, its largest market, WhatsApp has also been testing its payment system in Mexico.
A spokesperson from the tech company told a reporter that their goal is to use and open model of its services. He added that it’s communicating with its local partners and the Brazilian central bank to make it possible.
Central Bank Payment System
Following the suspension of WhatsApp’s payment services in the country, the company’s spokesperson said that it supports the PIX project.
PIX is the Brazilian central bank’s payment services which has secured over a thousand partners. The initial plan of the central bank was to launch PIX by November 2020.
Meanwhile, the messaging company’s payment services just rolled out in Brazil last week. This was also the first time that it conducted a nation-wide rollout of its services to a certain market.
The said payment services allow consumers to exchange money and even use it to pay businesses.
The company said that it’s not requiring its users to pay any fees during transactions. However, businesses are parting a 3.99% processing fee to receive the payments.
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