Market Trends of Brazil Retail Banking Industry
Digital Payments Are Driving a Profound Change in Brazil's Banking Sector
Digital payments are causing a seismic shift in Brazil's banking sector. Over the last decade, a silent revolution in Brazil has resulted in increased competition, greater financial inclusion, and lower banking fees. The explosion of digital payments in Brazil has resulted in the development of an innovative financial ecosystem that benefits ordinary people. This advancement is the result of a combination of changes to the payments regulatory framework, extensive use of technology, entrepreneurship, and a focus on developing products that meet the needs of Brazilian customers.
Open Banking in Brazil is Driving the Market
Open Banking and Open Finance were adopted in Brazil through four stages. Phase 3 involved payment transaction initiators starting Pix transactions, the Brazilian immediate payment system, and Phase 4 saw the launch of Open Finance.
In order to facilitate the development of cutting-edge new services, Open Banking enables banks to securely share customer data with third parties on a consent-driven basis. The next step is called "Open Finance," which opens up the possibility of data sharing for the mortgage, savings, pension, insurance, and other industries.
Statistics from the Central Bank of Brazil show the ecosystem has now processed a total of 8.5 million customer data-sharing consents. There are an average of 286 million API calls per week - amounting to more than five billion API calls since April 1, 2022. Brazil has over 5.6 million Open Finance customers and more than 800 participating institutions.
Open banking is a positive initiative that encourages innovation and brings greater convenience and a better customer experience with financial services. It also tends to intensify customer value propositions with new products and services. Several experts anticipate the transparent sharing of client data to boost competition and reduce the interest rates that banks charge their customers.
