Categories: Payment Methods

Brazil Regulator Lifts Suspension Of WhatsApp’s Pair-Up With Cielo

Cade, the Brazilian antitrust watchdog, announced it would be reversing its decision to suspend the WhatsApp payment services partnership between Facebook and Brazilian card operator Cielo, Reuters reported.

According to Cade, the decision was made because preliminary information from both Cielo and Facebook indicated that they would not infringe on peoples' choices and wouldn't limit other deals with rival companies. Cielo is the largest acquirer in Brazil, boasting a 41 percent market share.

Cade had previously been concerned about favoritism issues, as WhatsApp could boost Cielo card transactions by 10 percent.

However, Cade said it would continue investigating the partnership, and the decision does not mean WhatsApp's separate partnerships with payments giants Visa and Mastercard will be restored. Those two organizations were blocked because they had failed to seek Cade's permission to do so first.

A spokesperson for WhatsApp expressed gratitude for the decision, saying that the company looked forward to letting “all WhatsApp users in Brazil to send money to friends and family or purchase a product right on WhatsApp,” the spokesperson said, as reported by Reuters.

Last week, Cade made the decision to suspend the payments service partnerships with Visa, Mastercard and Cielo. Cade worried that WhatsApp, which enjoys substantial popularity in Brazil as its second-biggest market worldwide, would infringe on competition, as well as data privacy and efficiency.

With 120 million users in Brazil, the country is second only to India for WhatsApp's total popularity.

Cade has said it wants to preserve a banking system in Brazil that is competitive and has a payments infrastructure that allows for quick, cost-efficient, modern and open transactions. It blocked WhatsApp's payment system before any troubles had officially happened — Brazil was the first country where the payments system was launched.

WhatsApp's payment system represents the push by Facebook to enter the payments market in a major way. It would constitute using Facebook Pay to send and receive money.

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The How We Shop Report, a PYMNTS collaboration with PayPal, aims to understand how consumers of all ages and incomes are shifting to shopping and paying online in the midst of the COVID-19 pandemic. Our research builds on a series of studies conducted since March, surveying more than 16,000 consumers on how their shopping habits and payments preferences are changing as the crisis continues. This report focuses on our latest survey of 2,163 respondents and examines how their increased appetite for online commerce and digital touchless methods, such as QR codes, contactless cards and digital wallets, is poised to shape the post-pandemic economy.