Brazil's government-run payments system has become dominant

> Pix has spiced up Brazil’s fusty banking sector, but it gives the central bank a worrying amount of power

I think a largely prefer a government-run payment system than an US company monopoly.

Payment systems take huge fees. It is always good if they get back to the country and not elsewhere. Digital paying is something fundamental. Like electricity.

Brazilian Pix is free though, at least for the time being. IMO the biggest thing is not the money behind it, but the ability to track individual payments. Even that, I prefer the government to have that information, than some shady owner of a private company

PIX are free for persons. Companies may* pay for pix services. My bank (that is not a good bank) charges a fixed amount of 4 BRL (aprox 1 USD) per transaction (to send PIX. not to receive) PIX in "maquininhas" may cost ~1% to the seller.

* may: banks are allowed to charge.

It's funny but also worrying how much Americans underestimate the impact a centralized government can have on people's lives. That probably means that eventually it will happen there.

A centralized – often socialist – government is the _definition_ of monopoly, you can't escape from it without risking jail or worse. No U.S. monopoly, no matter how much you hate it, will get close to this, and you think it does, you are sincerely naive at least.

There are alternatives to both inefficient government-run monopolies and US tech giant monopolies.

Even a small country like Denmark has multiple software and finance companies doing apps and software in the digital payments and banking field.

I don't think it is a realistic option in the US, at least in the current climate.

There are so many powerful and influential anti/small-government that are rabidly opposing anything made by the government, and offered to the people.

The argument is always the same:

- "It will stifle innovation"

- "It is unfair to business"

- "It will make people dependent on the government"

- "It will give government more access to spy on the citizens"

and the list goes on.

For decades the American people have been told that anything the government touches will be expensive, inefficient, and lead to a more taxes. Private sector knows best, and all that.

And it is especially bad right now. You had MAGA-influencers outright rejoicing that DOGE had laid off the 18F team, spreading the gospel that free (government-run) tax tools are an abomination.

The Brazilian government is a *very* corrupt authoritarian oligarchy. I would take any US company over that any day.

Yet we, a developing "third-world" country, have a better functioning payment system than the US, where it takes days, or even weeks, for a wire transfer to land, and you pay a huge amount of fees for that.

Cases in point:

- To transfer money to a broker, I need to pay around $5 in transfer fees via ACH or wire

- I want to change the custody of my stock market assets from one broker to another, and it will cost me $75 to move $60 worth of shares. Meanwhile, in Brazil, this process is free in every broker.

I don’t understand this binary. The UK was able to create a near-instant bank transfer system without monopolizing in the same way. https://en.m.wikipedia.org/wiki/Faster_Payments

It costing more for instant transfers is just a regressive tax on the working poor.

>For decades the American people have been told that anything the government touches will be expensive, inefficient, and lead to a more taxes. Private sector knows best, and all that.

Do you have some counter arguments?

I can't find the details of the UK system, but it's not "monopolized" in Brazil. Perhaps due to the fact that the infra is provided by the Central Bank, and banks choosing to implement Pix support must implement the Pix APIs in their system.

Which is way cheaper than credit/debit card charges from Visa and Mastercard.

Why do you assume a government-run monopoly is inefficient?

You should try to take a train in Switzerland sometime. Its government run and I guarantee you will be mind blown over its efficiency.

Do you mean US examples or world wide examples?

Because I think the whole government are inefficient and suck is partly a self fulfilling prophecy.

Swiss railways or how Taiwan created the semiconductor industry from scratch comes to mind. Estonia E-Government. Or like the Panama canal?

You should take one in Portugal, where it’s also government run…

> To transfer money to a broker, I need to pay around $5 in transfer fees via ACH or wire

I suggest switching to a better bank. This is unreasonable, my ACH transfers are free.

> I want to change the custody of my stock market assets from one broker to another

$75 sounds like a bargain, given the complexity it involves: https://www.bitsaboutmoney.com/archive/how-acats-transfers-w...

But anyway, I recently transferred some assets between brokers. It was free because the sending broker's fee to transfer assets out only applies when transferring the whole account. The receiving broker is happy to receive the assets, and shouldn't be charging any fee.

I made no assumption that government run organisations are necessarily efficient. The comment I responded to implied that government monopolies are inefficient by their nature, which I would argue against.

Well, every municipal broadband service I've tried has been better than the laughable garbage some ISPs offer out in rural areas, where they have a monopoly.

Making an assertion without arguments does not necessitate counter arguments.

And there's no surprise fraud claims.

Hum, sorry, no. It's a very corrupt liberal oligarchy.

Everybody adopting an open protocol is "monopolizing" now...

i wish i was not sympathetic to those arguments - and i used to not be, but then i actually worked in the federal government. perhaps local governments can efficiently provision services but the feds are handicapped in so many different ways it would be quite challenging to untangle.

realistically, the workforce that was hired around sorting through hundreds of thousands of bureaucratic paper documents in the 70s/80s is not the same workforce that can really build new products and the feds are mostly the former.

Any european who happened to have become sick once in the US can tell you about that if you will.

Silicon Valley

> 4 BRL (aprox 1 USD)

I wish. That's off by 50%

My wife runs a small retail makeup shop on Shopify, which started before pix and those surprise false fraud claims almost killed the business.

Pix was such a game changer. It is perfect.

i have friends who have had to deal with the NHS and absolutely ridiculous (like year+) wait times for specialists.

frankly i find the american healthcare system quite good if you have good job-tied insurance. most of the problems arise because we don’t have any sort of triage for high need issues and thus get overutilization and high cost.

It's cool that "we" have a payment system, however, I would never be comfortable using something whose people in charge are those that keep us (not me particularly because I've gladly left the country almost a decade ago) in this misery.

I use Crypto for everything you've mentioned. It's instant, almost free, and alexandre(he deserves a lowercased a) can't take my money if he feels that writing his name in lowercase makes me unworthy of my civil rights.

UPI from India is a much better system in my opinion since it’s decentralized and doesn’t give all the power to the central bank.

That is such an inane opinion by the author. I wonder if he/she knows central banks can literally print money. Helping to move it around is nothing, and benefits everyone.

Fast, free, and frictionless payments allow the economy to run better. That's better for the government and the people. Only corporations like Visa and Mastercard lose.

From personal experience, the quality of your insurance has little to do with wait times. I had best-in-biz FAANG insurance and I still had to wait months for dermatology and ENT appointments, for example.

The quality of your insurance definitely impacts wait times. HMOs are often faster and if you have medicaid you're going to look at much longer wait times for the specialists that accept it.

Months for specialists sounds bad (during covid the waits in the Bay Area got pretty bad), but for context on the NHS, they are currently targeting having more than 65% of patients served within ~5 months and they don't even make that target. Even the extremely capacity constrained Bay Area isn't close to that level of dysfunction.

It's the Economist, this kinda thing is just their weird party line

Where did you get this idea of a 'very corrupt authoritarian oligarchy'? Brazil is not much different from any other democracy and is far less oligarchic than Trump's USA. Also, PIX is managed by our independent central bank."

How so ? While it is P2P protocol, the network is pretty centralized.

UPI is owned by NPCI(gov entity) and runs on top of IMPS both the networks are strongly regulated by RBI the central bank.

There is fair amount of regulation and KYC/ AML requirements before an app/service gets direct access to the network and even then it can be pretty challenging. WhatsApp struggled for years to get UPI integration .

Holding money in a wallet has even more regulations than merely transferring it .

Payment networks tend to centralize by their nature. I see pix or UPI as competitor to Mastercard or VISA , they have proven it is possible to run a network far cheaper than claimed

18F was definitively the latter.

You'd be surprised how bad FAANG is, too.

This take is at best outdated and at worst disingenuous. Brazil’s democracy was threatened by an actual authoritarian with oligarchical ties during Bolsonaro’s presidency, but its institutions resisted, and he was democratically removed. Now he, his minions, the aspiring oligarchs, and the insurrectionists who attempted their own “January 6th” are facing real consequences — including jail time.

You can’t say the same about the US and its actual oligarchs.

(The corrupt part is true)

> Payment systems take huge fees

That is the monopoly cost. UPI is free for both payee and payer. Whatever it costs banks to operate it is covered by reduced cost of dealing with cash/consumer.

There is no independent component of a country. It is very naive to claim so.

https://www.cnnbrasil.com.br/politica/por-decisao-de-moraes-...

What kind of non-authoritarian country arrests people for merely cursing at politicians on twitter?

Moreover, what kind of non-authoritarian country issues hundreds of thousands of rulings by its Supreme Court?

The Brazilian Supreme Court is an unelected entity that has complete control over the country, and firmly issues unappealable censorship arrests.

There is absolutely nothing this tyrannical in almost any western democracy, sans the UK.

To give some reference, using stripe you pay 2-3% for credit card payments and PayPal charges you ~5% of the transaction amount. Apple store and Steam take 30%. So honestly 1% sounds like a great deal.

You would think, but is it in practice? In the Netherlands (and I believe many/most other countries), practically all non-cash payments are handled by either Visa or Mastercard. Technically a duopoly, but that's not a huge improvement either.

I think comparing Steam and to some extend Apple with payment methods, they are stores and it cost money to store apps and games and for this one I'm not 100% sure, but I read a while ago that they also pay taxes for you in the country you sell, while pure payment processing services are just a proxy to move money from one account to another. You could argue that 30% is high for that, but we aren't discussing it here.

Interesting and important question.

I know MobilePay by Danske Bank is one of the most popular payment apps and can be linked directly to a Danish bank account (probably using the Danish "Dankort" payment infrastructure) without Visa/Mastercard involvement.

Most Danish POS and e-commerce solutions support MobilePay and surprisingly the biggest international POS/e-commerce providers also support MobilePay:

https://docs.adyen.com/payment-methods/mobilepay/

https://stripe.com/en-dk/payment-method/mobilepay

https://help.shopify.com/da/manual/payments/shopify-payments...

Our independence from US-based Visa/Mastercard payment infrastructure is enabled by our decades-old "Dankort" digital payment infrastructure that was initially based on magnetic strip cards. Even today most people opt for a so-called "Visa/Dankort" chip card that domestically use the Danish Dankort payment infrastructure but can internationally be used as a Visa.

Isn’t this what FedNow is for in the US? Genuinely curious since I feel like transfers still take days. My assumption is that it’s not fully adopted yet, but my understanding is that the US is in the process of adopting this.

https://en.m.wikipedia.org/wiki/FedNow

> frankly i find the american healthcare system quite good if you have good job-tied insurance

Soviet union was fine too if you were an apparatchik…

Having worked in FAANG and for the Feds (on a project that was in collaboration with 18F, to boot), I respectfully disagree. You simply do not get the same calibre of technical operators or even just product operators in the federal government, full stop. Maybe they exist, but they're going to be occupying high up/plum positions because people like that are so rare.

In practice, it is software consulting companies that are doing all of the heavy lifting while the federal workers largely sit back and collect their paycheck - and talented operators are extremely rare there as well.

Do you have a guide on how to use it or what services accept crypto for this purpose?