Brazil Regulator Dismisses Itau Unibanco’s Appeal In Antitrust Case

Itau Unibanco Holding, Brazil’s largest lender, lost its appeal related to an antitrust case.

Earlier this year, Itau announced it would prepay small- and mid-sized merchants in two days after credit card sales with no interest rates, as long as the merchants receive all payments in a checking account in the bank. In October, Brazilian antitrust regulator Cade said the bank’s move stifled competition in the medium term, and just rejected an appeal on the case, determining that Itau cannot order merchants to have checking accounts at the bank as a condition for pre-payment. If the bank does not comply with the decision, it will have to pay a 250,000 reais ($59,574) fine per day.

But Itau said in published reports it will continue the stipulation because it obtained an injunction earlier this month allowing it to do so. The bank added it practices are no different than its rivals.

In May, the bank announced that it was launching a new QR code-based payment system called Iti, which will connect merchants and customers to each other. It can be used by both customers and non-customers of the institution. Merchants who use the service will pay a 1 percent fee per transaction to receive payments right away. The fee is cheaper than that of many current card processors, and the app doesn’t require a merchant to buy a card reader.

The CEO of Itaú’s card processor Rede, Marcos Magalhães, said the new service will attract a number of small merchants who don’t need customized services. The service is aimed at all Brazilians, regardless of income bracket, and can even be used by people with no bank accounts, since Iti also acts as a digital wallet with no fee.

And last year, Itaú Unibanco Holding added Apple Pay functionality. Brazil was the first South American country to support Apple Pay.