The credit card titans seek to leverage AI and data tools to deliver cybersecurity and other financial solutions as banks find it increasingly challenging to operate in the digital world.
On November 16, Brazil’s central bank goes live with a new instant payment platform, PIX, which promises transactions executed in less than 10 seconds at any hour of any day, with no fees for indivivdual users and costs for business users “much lower than what is charged today.”
More than 50 million people and companies as well as 900 financial institutions, including all the nation’s banks, are now registered with the system—public registration opened on October 5. Entities with at least 500,000 active accounts are required to offer the system, and to invest in updated technology to check user identification, avoid fraud and money laundering, and offer artificial intelligence (AI) solutions.
It will offer some fresh competition for existing payments players, but Visa and Mastercard are ready. Both currently awaiting central bank approval to launch their own WhatsApp-based real-time payment systems, they have long been preparing for this revolution in payment methods.
Visa acquired three tech companies to deliver services for Brazilian financial institutions. One is Brazil-based Conductor, one of Latin America’s leading digital payments providers. The credit card giant also bought Plaid, the engine behind Venmo, and snapped up Earthport, an leading player in international remittances.
“Our goal is for technological services represent two digits of our revenue,” said Fernando Teles, director-general of Visa Brazil.
Similarly, Mastercard bought several firms dedicated to AI and cybersecurity as well as Vocalink, the core engine of the British instant payment system. “More than a credit card company, Mastercard is today a technology company that develops solutions for all segments of the industry of electronic payments,” says João Paro Neto, CEO of Mastercard Brazil and Southern Cone.
The credit card titans seek to leverage AI and data tools to deliver cybersecurity and other financial solutions as banks find it increasingly challenging to operate in the digital world.
