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Central Bank announces PIX, instant payment system that replaces DOC and TED

PIX arrives in November with mandatory membership from large institutions and may be possible cryptocurrency competitor

After much speculation, the verdict: the Central Bank (BC) announces on Wednesday (19) its brand of instant payment, a PIX. The payment system will allow immediate transfers between checking accounts using QR Code and, although it has not commented openly, the initiative appears to be an attempt to combat the spread of means of payment with cryptocurrencies. Its launch is scheduled for November this year and follows a trend in emerging economies.

According to Joo Manoel Pinho de Mello, Director of Organization of the Financial System and Resolution of the Central Bank, the definition of the brand name, already in February, demonstrates the Central Bank of Brazil's commitment to launch the PIX in November this year.

How to participate in PIX

PIX instant payment systemPIX the Central Bank's instant payment system

According to Agencia Brasil, the collegiate board of the Central Bank of Brazil approved the rules for participation in a meeting that took place last week and the circular with those rules will be published in the Official Directory on Wednesday (19). The explanation is relatively simple: it will be mandatory that some institutions are participants in the PIX payment arrangement to make this alternative reach the end customer.

This mandatory participation is valid for all financial institutions with more than 500 thousand active customer accounts, which are cash deposit accounts, savings deposit accounts and prepaid payment accounts.

Through this criterion, we will have about 30 institutions, including financial institutions and payment institutions, representing more than 90% of the transactional accounts offered in Brazil, which must be mandatory participants in the PIX

Joo Manoel Pinho de Mello, Director of the Central Bank's Financial System and Resolution

Mello explained that being a PIX participant implies that the institution must not only be able to receive a PIX, but also offer the PIX, with all its features and forms of initiation for its customers. Obviously, all other financial payment institutions, even those that have not yet reached the limits to apply for authorization to operate as a payment institution, will be able, on an optional basis, to participate in the PIX since its launch.

Main objective

O central bank either to replace transactions with cash or by means of bank transfers (TED Electronic Transfer Available and DOC Credit Order Document) and debits by transactions between people. The idea is that instant payments are made in a few seconds, running for twenty-four hours and every day of the week, including Saturdays and Sundays.

central bankCentral Bank headquarters building in Braslia

The Central Bank also states that making transfers using an address key and making payments with static or dynamic QR code reading, are features that will be available since the official launch of PIX, scheduled for November 16, 2020 two weeks earlier, on November 3rd, a pre-launch is stipulated, with the system still in the final testing phase.

Even one of the features available in November is the collection of resources by the National Treasury.

Testing start

On this Wednesday, the tests on the settlement platform (SPI) and on the Directory of Transactional Account Identifiers (DICT), which is the addressing base: among the universe of PIX participants, some institutions will also be required to be direct participants in the Instant Payment System (SPI), that is, you will have to connect directly.

All commercial banks, multiple banks with a commercial portfolio and savings banks that are participants in the PIX must be participants in the SPI.

a criterion that represents about 20 institutions. All institutions that are direct participants in the SPI must also access the addressing base directly. With these measures, the Central Bank aims to foster competitiveness and innovation in the Brazilian financial system and, consequently, generate better opportunities and options for clients.

Partnership with Febraban

PIX has partnership with Febraban and Central BankFebraban launches note on collaboration with the Central Bank for the development of the PIX

Taking advantage of the official launch of PIX, Brazilian Federation of Banks (Febraban) also released this Wednesday, a note in which it shows a favorable initiative from the Central Bank and also confirms that banks in general will invest resources in infrastructure, technology and security to standardize and organize a system that offers convenience and reliability to customers.

The new payment method will be able to be used in all electronic devices of financial or payment institutions, such as applications for smartphones and ATMs.

Febraban sees PIX as an innovation that will bring more security and convenience to the consumer in their financial transactions. This measure is in line with the investments that the banking sector has been making in technological modernization, of approximately R $ 19.5 billion annually.

Leandro Vilain, Director of Business and Operations at Febraban

And go beyond. PIX also applies to any type of transaction, such as money transfers between people or companies, making purchases in person or on the internet, paying household bills, in addition to paying public fees, such as passports or taxes, or public services, such as public transport.

Febraban, which confirms a partnership with the Central Bank, also says that it is in favor of measures that reduce the need for cash to circulate in cash, after all, the cost of logistics alone totals approximately R $ 10 billion a year in expenses.

Source: Brazil Agency