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Tech Roundup, Mar. 20, 2019 | Covid-19 hits Brazilian e-commerce

. Mar 20, 2020
Covid-19 drops a bomb on Brazil's e-commerce sector Photo: Esich Elena/Shutterstock

You’re reading The Brazilian Report‘s weekly tech roundup, a digest of the most important news on technology and innovation in Brazil. This week’s topics: Covid-19’s impacts on e-commerce, Central Bank’s new payment method, how gig economy apps are trying to help workers amid the pandemic.

Covid-19 drops a bomb on Brazil’s e-commerce sector

Brazilians

in self-isolation have turned to e-commerce for supplies, bumping sales of goods such as foods, beverages, beauty products, and healthcare items by over 180 percent. These figures are from the Brazilian e-commerce association. But while that new reality could be good news for retailers, online shops of the country&#8217;s largest supermarkets are actually limiting purchases in an effort to <a href="https://brazilian.report/business/2020/02/27/could-coronavirus-outbreak-supply-shortage-brazil/">avoid shortages</a>, in the molds of the empty shelves beginning to crop up in brick and mortar stores. </p> <p><strong>What’s going on?</strong> Overburdened with orders, supermarket chains are asking customers to “be sympathetic with others and purchase only enough for [their] family.” They have also warned customers that delivery deadlines could be delayed. Wholesaler Makro informed it no longer has available time slots for delivery.</p> <p><strong>Crisis is bad—for everyone.</strong> Despite the spike in purchases of essential goods, there are signs that Covid-19 fears will make customers wary about spending on non-essential items, thus harming e-commerce. Market intelligence company Compre&amp;Confie <a href="https://www.blog.compreconfie.com.br/post/e-commerce-recua-em-fevereiro-por-poss%C3%ADvel-influ%C3%AAncia-do-coronav%C3%ADrus">reports</a> that between February 1 and 19, e-commerce sales fell 7.7 percent in volume and revenues shrank 5.2 percent from January. The study relates the drop to the pandemic.</p> <hr class="wp-block-separator"/> <div class="banner daily mt-5 mb-5 post"> <div class="row"> <div class="col-md-8"> <h3 class="titulo">BRAZIL DAILY</h3> <img class="mobile" src="https://brazilian.report/wp-content/uploads/2020/03/image_d.jpg" alt=""> <div class="subtitulo mb-2"> TUESDAY TO FRIDAY</div> <p style="margin-bottom: 0"> Our editorial team distills the most pressing issues facing Brazil, offering insightful commentary, analysis, and exclusive charts. We make sure you're up to date by the time you finish your coffee.</p> <p class="roxo"><strong>This Newsletter is for PREMIUM subscribers only.</strong></p> <a href="/newsletters/" class="seemore invert">Subscribe</a> </div> <div class="col-4 text-center desktop"> <img src="https://brazilian.report/wp-content/uploads/2020/03/image_d.jpg" alt=""> </div> </div> </div> <hr class="wp-block-separator"/> <h2>Brazil’s Central Bank creates a standard QR Code for payments</h2> <p>Brazil&#8217;s Central Bank announced the new &#8220;BR Code,&#8221; a standard QR code for payments in Brazil. With this new platform, the monetary authority intends to increase people’s access to information and foster the competition in Brazil’s financial system. </p> <p><strong>How does it work? </strong>QR Codes are already used by some banks and fintechs to allow users to pay by pointing their smartphone’s camera to a QR code at points of sale. The BR Code will make that a standard, but customers have to be informed about which payment method they are using. Companies will have six months to update the currently used QR codes to the new system. </p> <p><strong>Why it matters. </strong>The payment method sector has been at war for a long time due to increasing options provided by banks and fintechs. As a result, prices have dropped significantly, providing better conditions for consumers. The decision is yet another measure in the Central Bank’s agenda to make the financial sector<a href="https://brazilian.report/business/2019/11/26/brazil-plan-to-slash-bank-spreads/"> more competitive</a> and less concentrated in Brazil, which includes measures such as <a href="https://brazilian.report/business/2019/04/30/open-banking-brazilian-customers/">open banking.</a>    </p> <hr class="wp-block-separator"/> <h2>Gig-economy apps to support workers, entrepreneurs amid Covid-19 outbreak</h2> <p>Food delivery app iFood and ride-hailing app Uber announced they will support Brazilian drivers if they become ill during the Covid-19 outbreak in Brazil. The decision comes amid worries that these professionals, who already have few social security protections, may become more vulnerable as the demand for deliveries increases with more people staying at home. As we reported in <a href="https://brazilian.report/coronavirus-brazil-live-blog/2020/03/18/economy-minister-to-launch-corona-voucher-in-brazil/">our March 18 story</a>, the Ministry of the Economy will also provide a “corona-voucher” for autonomous workers that are hit by the pandemic. </p> <p><strong>What are companies doing? </strong>Uber drivers who test positive or are suspected of having Covid-19 will receive financial aid from the company for 14 days, based on their average daily earnings of the past six months. iFood created a BRL 1 million fund to provide financial aid or meals to couriers that fall ill. It also came up with a BRL 50 million fund to provide extra resources for restaurants, based on their previous income and whether they are located in a particularly hard-hit area. Individual entrepreneurs will also be a priority. Click-and-collect processes will be made easier, and payments to restaurants will be quicker. </p> <p><strong>Why it matters.</strong> <a href="https://brazilian.report/business/2019/12/19/brazil-moves-regulate-gig-economy-worse-workers/">The gig economy</a> has become one of the pillars of the wobbling recovery in the Brazilian job market before the Covid-19 outbreak. Without support, these workers would have no other option but to keep working, even if they fell ill, risking becoming a powerful transmission vector for the disease. Plus, a collective bankruptcy of small companies—such as restaurants—could push Brazil even further into the recession banks are already forecasting.  </p> <hr class="wp-block-separator"/> <h2>Take note </h2> <ul><li>The Senate carried out a virtual voting session for the first time in its history today to approve a declaration of a state of public calamity. While senators will have to say their votes out loud in this first version of their online system, the crisis prompted Brazil to institute a new remote voting system that will allow lawmakers to vote on emergency situations, such as pandemics, wars, public calamities or social unrest. The system will work with previously approved devices and has safety measures such as personal passwords and unique codes for each session.</li><li>Broadband consumption has increased 40 percent in the first three days of self-isolating measures in Brazil, per data obtained by newspaper <a href="https://www1.folha.uol.com.br/mercado/2020/03/em-tres-dias-de-quarentena-consumo-das-redes-de-telefonia-subiu-40.shtml"><em>Folha de S.Paulo</em></a>. Brazil’s four major telecom operators verified peaks of consumption over 15 percent higher than average. They fear that if this rises to a 150 or 200 percent peak, ISPs may fail.   </li><li>Spotify is testing a new app for children in Brazil. Available for the “Family” premium subscription, Spotify Kids has two categories: content for younger children and for preteens. The first includes Disney Classics and lullabies, while the second is focused on pop artists famous among younger age groups.</li><li>Brazilian researchers are cooperating with the international project Waterproofing Data in an attempt to help to prevent floodings in Brazil. Their goal is to create an app allowing people to measure rainfall and river levels in real-time. The beta phase is being tested at schools in São Paulo and Rio Branco, the capital of Acre state. Students are measuring rainfall in home-made pluviometers and uploading the data to the app, which should be available widely in the second half of 2020, according to <a href="https://abori.com.br/ciencias-humanas/pesquisadores-desenvolvem-app-alimentado-por-alunos-para-ajudar-no-combate-as-enchentes/">Agencia Bori</a>. </li><li><a href="https://brazilian.report/tech/2019/07/12/health-tech-continues-grow-brazil/">Brazilian health-tech</a> startup Hi Technologies has developed a test to identify the coronavirus that only takes 10 minutes to complete. The goal is to make it available for in-company use by April. The company currently produces Hilab, a portable IoT device that analyzes drops of blood and sends data to doctors. </li><li>The Ministry of Education has launched the app Clique Escola, gathering data from 180,000 public and private schools all over Brazil. The goal is to communicate more easily with the institutions, but the app will also provide data such as the schools’ performance on the National Elementary Education Test (Saeb), an average of students per age and level, the share of higher-educated teachers, plus the rates of performance, approvals, fails, and dropouts per level. 

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Natália Scalzaretto

Natália Scalzaretto has worked for companies such as Santander Brasil and Reuters, where she covered news ranging from commodities to technology. Before joining The Brazilian Report, she worked as an editor for Trading News, the information division from the TradersClub investor community.

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