How Brazil positioned itself as a global benchmark in financial regulation

The World Bank’s Global Findex showed that digital and mobile solutions have widened people’s access to financial services during the pandemic and that Latin America was the region where account ownership grew the most in the last four years. 

In the case of Brazil, this was possible due to at least three significant regulatory changes that triggered the country’s fintech boom in the last decade. 

But two ongoing shifts promised to be even more game-changers: PIX, the country’s real-time payment system launched in late 2020, and open finance, a regulatory framework designed to gradually enable the smart sharing of information between banks, neo-banks, and fintech companies aiming at customer empowerment.

The end of the Visanet-Redecard credit card duopoly

The opening of Brazil’s acquiring market was the first big step toward the multitude of players and payment arrangements in play today. Until 2010, there were only two acquirers in the country: Visanet and Redecard (now Cielo, owned by Bradesco and Banco do Brasil, and Rede, controlled by Itaú), capturing Visa and MasterCard labeled card operations. 

That year, following a report on the payment card industry by the government and the Central Bank that showed that a more open market could also be a more profitable one, the industry itself decided to make some changes. 

They include opening the chain for more issuers, disclosing exchange rates more transparently, and enabling the interoperability of POS terminals (until then, Rede’s card machines could only receive MasterCard transactions, and Cielo’s POS could only process Visa operations). 

In 2012, a report by the Central Bank showed that the industry’s concentration rate...