Brazilian payment institutions: opportunities for foreign investments

New foreign investments in the Brazilian financial market have been facilitated by recent measures that removed the need for a specific authorization from the President of the Republic. Nevertheless, operating a traditional financial institution remains bureaucratic and costly. The November edition of LS Brazil Outlook discusses alternatives to offer financial services in the country.

We begin with a discussion on banking-like services that may be rendered by payment institutions such as card issuers and acquirers, followed by a comparison between these institutions and the heavily regulated financial institutions. Our third article points out that such lighter regulatory regime is complemented by the recently launched sandbox regulation and opportunities it opens for ventures in the foreign exchange and cryptoassets markets. Finally, we stress the lighter regime applicable to financial institutions studying the case of Payment Initiation Service Providers (PISPs), a new kind of payment institution created in the context of the Brazilian Open Banking.

The Brazilian payment services industry is flourishing, and regulation is supportive to new foreign investments in this field. Enjoy your reading.