Automatic Pix and the next revolution in Brazil

Automatic Pix, the latest evolution of Brazil's instant payment system that has been influencing Real-Time Payments throughout the world, promises to simplify the payment of recurring bills.

As you might know, Pix allows users to transfer money and make payments practically instantly, 24 hours a day, 7 days a week. This has drastically been reducing dependence on traditional payment methods, such as bank slips and TEDs, which usually take hours or even days to be processed as well as compensated.

The feature, known as Pix Automático, is scheduled to be launched in October 2024, is an extension of this efficiency. With this functionality, users can automatically authorize recurring transactions, such as monthly invoices for water, electricity, internet and others.

The new feature offers an improved and cost-effective recurring payment system that will have a high impact on credit cards, subscription services, and automatic debit, as people will be able to pay simple bills and monthly expenses through this new payment method, which has already been widely accepted by the population.

The Pix Phenomenon:

Nowadays, almost 80% of all Brazilians pay with Pix and more than 700 thousand people have opened a bank account to make Pix payments.

Open Finance payments using the Pix system, such as those using Trio Checkout, have been doubling in number every month.

Pix has 146,4 million users, composed of 134,8 million people and 11,6 million companies. Since its launch it has originated more than 66,5 billion transactions (until October 2023).

Taking Pix Automático as the next case, our product team has unfolded three main user journeys that have been mapped by the Central Bank and their organisers for usage of this feature. You can find them below:

Journey #1 - Consumer signs new contract to pay monthly

The first user journey we mapped will be for signing new contracts (for gyms, schools, or any prepaid recurring plan that is not based on SaaS), and requires the customer to sign a new contract that is paid monthly. In this method, the company delivers a new payment proposal to the customer, who receives a notification to authorize the recurring transaction from their bank account, and the Pix Automático system collects the agreed-upon amount from the buyer's account every month.

Journey #2 - Buy-Now-Pay-Later, no Credit Cards needed

In the second method of transaction, the customer divides the total amount into recurring payments - potentially replacing credit cards - where the establishment offers the Pix Automático code with incorporated installment payments. The customer then scans the Pix code and confirms the amount to be paid under the established condition, formalizing the agreement between the establishment and the customer.

Journey #3 - SaaS or Recurring payment to charge monthly

In the third and final method, payments are made based on SaaS or recurring payment, in which the company charges the customer a monthly fee. In this case, the company sends a monthly invoice adding an offer for the customer to pay with Pix Automático. The customer must scan the Pix code containing all the information and thus confirm the monthly charges from the buyer to the company's account.

A new democratic movement for companies is blooming. During the Pix Forum, Brazil’s Central Bank has developed the space for the Payments Manager to emerge and act as what is, not a bank or credit institution, but focused on transactions only:

• Any Pix Participant can develop a Manager activity;
• Contracts contemplating multiple Payments Managers will not be allowed;
• Resources can be transferred whenever receivers ask;
• Managers must maintain the amount at their original accounts during the entire process.

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