Whatsapp Pay

WhatsApp is the most popular messaging app in Brazil, with over 120 million users. Knowing this, it seems like the central bank wanted to protect its role as a leading mobile payment provider.

The Brazilian IP scheme PIX was released in November 2020, and less than a month after being introduced, it had 100+ registered accounts. We can conclude that the Central Bank of Brazil made an intelligent move.

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What is WhatsApp Pay?

WhatsApp Pay is an in-app payment option that allows users to make transactions directly from the chat using Visa and Mastercard cards. The company initially introduced the service in Brazil in June 2020, but the central bank reacted immediately and suspended it. The bank said WhatsApp Pay could damage the country’s payment system in terms of competition and data privacy. Furthermore, Banco Central do Brasil added that Facebook didn’t obtain the necessary licenses.

Initially, WhatsApp wanted to rely solely on Visa’s and Mastercard’s bank licenses. It means that Facebook rolled out the service without official authorization to operate as a financial institution. In other words, they tried to avoid categorization as a financial service provider.

However, the central bank didn’t allow this. It forced Visa and Mastercard to stop financial transactions through WhatsApp in Brazil, threatening with fines. As a result, WhatsApp had to apply for regulatory approval, while both payment processing networks also had to ensure new permits to operate with the messaging app.

WhatsApp spokesperson told in a statement that the company is making final preparations to re-enable the service “as soon as possible.” However, at the moment, WhatsApp is only allowed to offer peer-to-peer (P2P) transactions, not involving businesses.

Will WhatsApp Pay Impact Online Casinos in Brazil?

WhatsApp initially rolled out the payment services in June 2020 but was swiftly banned by Banco Central do Brasil due to anti-competitive concerns.

On March 30, 2021, the central bank officially allowed WhatsApp to let Brazilian users send and receive payments within the messaging app. The approval came a few months after Brazil’s central bank introduced its instant payment product, PIX.

Brazil has more than 140 million mobile internet users (according to Statista). It means that mobile-first solutions have a vast customer base to introduce mobile payments.

PIX has already proved to be a huge success, with online casinos starting to accept this state-owned banking method. We can expect to see the same success with WhatsApp Pay too.

The reason is simple. People gladly accept mobile payments in local currency to make online transactions without registering new accounts. We already said that WhatsApp is the most popular messaging app in Brazil, so the “infrastructure” is already there. Online casino players are among those 120 million WhatsApp users. So, a new payment feature licensed by the most respectful monetary institution in the country sounds good.

Conclusion

As mentioned above, the latest regulatory approval allows WhatsApp to facilitate only P2P transactions. Facebook is still seeking consent to cooperate with merchants to accept digital payments from WhatsApp. We think that it’s only a matter of time when FB will obtain permission for merchant payments. We are also sure that online casinos will be among the first ones to list a new banking method on their cashier pages.

To conclude, gamers in Brazil should be excited as they’ll get another convenient mobile payment method. The same applies to online casinos. The new banking method that enables easy & quick deposits will increase their customer base. It’s a win-win situation.