Pix beats cards in transactions for first time

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The number of transactions through Pix surpassed those with credit or debit cards in the fourth quarter. It was the first time that the Central Bank’s instant-payment system took the first position among the most used payment methods.

Most transactions represent transfers between individuals, but the figures indicate the widespread use of the system. For specialists, Pix is likely to grow further, but there are factors linked to security and technology, for instance, that may restrain this advance.

According to the most recent data from the Central Bank, transactions via Pix totaled 3.89 billion in the last three months of last year, up 34% over the previous quarter. In cards, transactions also grew, but at a slower pace. There were 3.85 billion transactions using debit cards (up 9%) and 3.73 billion through credit cards (up 12%). Prepaid cards advanced 20%, to 1.92 billion transactions.

Options to transfer funds like TED and DOC, as well as intra-bank transfers, lost ground since the launch of Pix, in November 2020, figures from the monetary authority show. In the last quarter, there were 294 million transactions using TED, for instance, down almost 50% in one year.

Ricardo Vieira, the executive vice-president of Abecs, an association of credit card companies, says there is no competition between transfer options and that “there is room for everyone.” “All arrangements are welcome because they bring competition and make available to the market solutions that help to insert the population in electronic means of payment.”

According to Abecs data, the volume transacted with credit, debit and prepaid cards totaled R$2.65 trillion in 2021, up 33.1% year over year. The association projects a growth of 21% this year, to R$3.2 trillion.

Mr. Vieira stresses the fact that the average ticket for card operations is much lower than that of Pix. This confirms the greater use of cards in daily payments by individuals, he said. The average value of transactions through Pix in the fourth quarter was R$495, compared with R$126 for credit cards, R$67 for debit cards and R$21 for prepaid cards, data by the Central Bank show.

The use of Pix is likely to grow further considering the low cost and speed of transactions, said José Luiz Rodrigues, founding partner of the consulting firm JL Rodrigues, which is specialized in the regulation of the financial system. This is especially true as new functionalities are included, such as the possibility of installment payments. The Central Bank has a wide list of functions to be put in place, but sources say that the schedule may be hindered by a strike scheduled by the bank’s servers.

The specialist added that, at some point, the instant-payment system is likely to start affecting cards more directly, especially debit cards. “The credit card has other advantages, such as points and cashback rewards, but then we are talking about a wealthier public. Pix has included a lot of people in the system.”

The instant-payment system is already widely used for transactions between people, but it has also been growing among companies. In February, 72% of the transactions were made between individuals, and individuals transferred funds to businesses in 18% of them. A year earlier, these shares were 79% and 9%, respectively.

João Manoel de Lima Junior, coordinator of the Nucleus for Advanced Studies in Regulation of the National Financial System at FGV Direito Rio, also believes that Pix is likely to advance further over the space of other means of payment. Yet, he sees factors that may limit this growth.

The first one is technological. “One factor is the potential institutional incapacity to, for example, face the needs of technological innovations precisely to keep the system always ahead and updated,” he said, recalling Pix was operationalized by the Brazilian state.

He says there are still risks related to fraud and operational problems. In a little over a year of operation, three data leaks occurred. In the researcher’s view, despite that, the system has not yet had to face any “scandalous” problems. “There is a very big novelty factor in Pix, it is a kind of cultural phenomenon, but it has not yet been exposed to a major crisis, such as a crash, for example. In technology, operational risk is always present.”

The Central Bank did not comment on the subject.

Source: Valor International

https://valorinternational.globo.com