Brazil’s Pix instant-payment system is getting closer to connecting with Europe’s instant-payments infrastructure, after its integration project with the European Central Bank’s (ECB) TARGET Instant Payment Settlement, known as TIPS, advanced from the pre-investigation stage to the investigation phase. The shift indicates that preliminary studies found no critical obstacles to continuing the initiative.
The information appeared in a document presented during a meeting of the TIPS Consultative Group, an ECB-affiliated body that discusses improvements and tests on the platform. The meeting took place on Oct. 20.
According to the ECB, the pre-investigation phase, conducted in September, assessed technical, legal and operational aspects, as well as the commercial viability of a potential connection between the two systems. No impediments considered critical were identified.
The new phase will deepen studies to determine whether the interconnection is technically and economically viable. No deadline for its completion has been set.
According to information from the news outlet Broadcast, sources close to the negotiations expect the full pilot project to be ready by the end of 2027.
In the same week the document was presented, Gilneu Vivan, director of regulation and organization of the financial system at the Central Bank of Brazil, traveled to Frankfurt, Germany, to discuss the possible integration with representatives of the ECB.
How could Pix work in Europe?
An eventual connection between the platforms would allow Brazilians to use their bank accounts in Brazil to make payments at European businesses.
One model under consideration involves the use of QR codes. Under that scenario, a consumer could open the app of their Brazilian financial institution, scan a code provided by a store in Europe and authorize the payment in reais.
The system would carry out the currency conversion and allow the merchant to receive the amount in euros. The transaction could take just seconds, without the consumer having to resort directly to an international card or a traditional bank transfer.
The possibility was explained to the daily Folha de S.Paulo by Thiago Cavalcanti, president of the National Association of Central Bank Auditors of Brazil (ANBCB). He stressed that the operation would likely involve costs, which would need to be presented to consumers transparently. The currency conversion rate would also be an important factor in making the service competitive.
The project is not limited to in-store purchases. According to the Central Bank of Brazil, the connection between instant-payment infrastructures could also facilitate international remittances, making funds available in local currency within seconds.
Source: Olhar Digital
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