WHATSAPP PAYMENTS SUSPENDED AFTER 9 DAYS OF OFFICIAL LAUNCH BY BRAZIL’S CENTRAL BANK
Nine days after rollout, WhatsApp payments face suspension from Brazil’s Central Bank in wake of what the authority says it wants to assess risks to the country’s payment system. However, it’s understood Brazil is currently the second-largest market for the subject social platform – WhatsApp but a move viewed as a setback for Facebook which introduced the payments system in Brazil.
To ascertain the monetary authority’s decision, it’s also been figured out that bank authorities have equally moved requesting that Mastercard Inc. and Visa Inc. stop payment coupled with money transfer activities through the app. While the CBB aim is to “preserve an adequate competitive environment, that ensures the functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap”, the monetary authority stated on its website.
It’s evident there are concerns even as banking authorities have urged payments’ companies to comply, should they fail to comply! Those payment companies stand to face fines coupled with administrative sanctions. Brazil’s Central Bank equally made it clear that it hasn’t had the opportunity to analyze WhatsApp’s payment service before it was rolled out.
Responding to WhatsApp payments suspension, a fintech and banking regulation specialist ‘Tiago Gomes’ made it clear that suspension without presenting further arguments is “an unusual, extraordinary move by the central bank, especially in payments arrangements and technology market”.
Since the app has been tested in markets including Mexico and India, it’s also understood, one of the key elements of WhatsApp long-term plan is to offer commerce within the app, while at the moment, it’s reported, more than five million merchants around the world use the business version of the messenger app. Based on this development, a WhatsApp spokesperson made it clear that “our goal is to provide digital payments to all WhatsApp users in Brazil using an open model and we will continue to work with local partners and the Central Bank to make this possible, adding that, “we support the Central Bank’s PIX project on digital payments and together with our partners are committed to work with the Central Bank to integrate our systems when PIX becomes available”.
The PIX is referred to as Brazil’s proposed instant-payment system. In another dimension, the subject company is understood to be surprised by the Central Bank’s decision, based on the fact that the two bodies were in regular contact in the run-up to the payment launch according to a source that chose not to be mentioned.
The company (WhatsApp) had earlier posted in a blog post while announcing the app launch that “we’re excited to announce that starting today we’re bringing digital payments to WhatsApp users in Brazil. Adding that “we’re making sending money to loved ones as sending a message, which could not be more important as people are physically distant from one another. Because payments on WhatsApp are enabled by Facebook Pay, in the future we want to make it possible for people and businesses to use the same card information across Facebook’s family of apps”.
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