Brazil’s Central Bank has ordered Visa and Mastercard to suspend support for payments over WhatsApp. The bank said in a statement that the new money transfer service launched on WhatsApp needed prior authorisation.
The country’s Central Bank said it needs to make sure an appropriate competitive environment is maintained and the payment system remains interoperable, fast, secure, transparent and inexpensive. Suspending the new service will allow the central bank to assess any risks to the proper functioning of the Brazilian payment system and verify compliance with the existing principles and rules.
Brazil’s Administrative Council for Economic Defense (Cade) also issued a precautionary measure to suspend the partnership between Facebook and Cielo to enable payments over WhatsApp. The service would offer accredited merchants in Brazil the option of receiving payments through the WhatsApp Business platform.
According to a Cade analysis, there are potential risks to competition, as Cielo has high participation in the national transaction market, while WhatsApp has a base of millions of users in Brazil, which can guarantee a significant market power.