The bank will create a platform that may be used by the government, in the future, to make payments to social benefits and for tax reimbursement.
In Brazil, the highest financial institution, the Central Bank of Brazil (BCB) commented through a press release, last February 20th, that it is preparing a new instant payment platform that will be launched later this year 2020. The payment system will seek to compete directly with the operations conducted with cryptocurrencies.
The new system will be supported through a platform called “Instant Payment Scheme (PIX) of Brazil” and will be used to make payments in an average of 10 seconds or less. The operations may be conducted by a natural person or even companies, using electronic banking, mobile phone or even ATMs as tools.
The platform could serve as support not only from natural persons to others but could also carry out large banking operations between companies, thus facilitating liquidation in a very short time.
According to the press release, the BCB will notify national banks that it is duly registered and regulated to provide all the functions and tools necessary for customers to have access to the PIX payment system.
The note concludes detailing that to conduct the transaction, the person interested must use a QR code or provide basic customer information, such as his identification number, telephone number or email address.
PIX as a Direct Response to Cryptocurrencies
Pix emerges as a direct response to the blockchain-based payment system with cryptocurrencies, as stated by the president of the BCB, Roberto Campos, during his speech at an event held in Sao Paulo, as local media reported.
Campos claimed that the cryptocurrency payment system results to be cheap, fast, and secure. He also said that for these reasons it has had a great result in people so PIX takes these characteristics into a traditional currency payment instrument.
“Pix arose from the need of people to have a payment instrument that was cheap, fast, transparent and secure. If we think about what has happened in terms of the creation of Bitcoin, cryptocurrencies and other crypto assets, it comes from the need for having an instrument with such characteristics”.
The president of the BCB also assured that for banking, PIX is its main priority during this new year 2020 and that through this platform the need for the use of physical money and its operating costs could be replaced.
In another sense, the PIX platform may be used for the payment of taxes and other contributions. This is explained on the official website of the BCB. So the highest financial institution in Brazil managed to partner with the National Treasury Secretariat to meet this objective.
Besides, it is also noted that even the government will use this platform in the future to send tax refunds, subsidies, and other social benefits.
In this way, the South American country opens up to new technological possibilities in response to a significant loss. This new opportunity is thanks to the benefits that cryptocurrencies offer.
By María Rodríguez