Brazil’s Central Bank Wants More Authority Amid FinTech Explosion

Brazil’s central bank is reportedly dealing with pushback as it seeks greater autonomy.

As Bloomberg News reported Wednesday (June 10), the bank is arguing that limited resources are hindering its oversight as the country’s financial system grows more complex.

A constitutional amendment that would give Banco Central do Brasil more financial autonomy has cleared a senate committee in Brazil, the report added, though getting it through the full legislature might take months.

According to Bloomberg, central bank chief Gabriel Galípolo argues the changes are needed as the bank faces dwindling resources and growing responsibilities, including overseeing the hugely popular Pix instant payment system.

During a recent public hearing, Bloomberg said, Galípolo appealed directly to lawmakers, calling on them to, “for the love of God,” move the bill forward.

The central bank’s staffing levels have dropped 42% in the last decade, the report added, while the number of supervised financial institutions has risen by around 50%, thanks to the rise of digital banks, FinTechs and payment companies.

However, skeptics inside the government worry that giving the central bank full financial autonomy would separate its budget from Treasury oversight, thus providing fewer resources that now help mitigate public debt, the report said.

As covered here earlier this year, part of the pressure facing the central bank is the increased attention related to Pix, which needs to be monitored 24/7.

At the time of Pix’s fifth birthday, it had become Brazil’s leading real-time payments rail, with transactions nearing 7.3 billion in October, up from 5.7 billion a year earlier.

This change has been fueled by “Brazil’s highly digital consumer base and mobile-first behavior have accelerated the adoption of instant account-to-account payments,” as PYMNTS wrote.

The trend has also moved from retail adoption to day-to-day B2B use, with Pix’s year-over-year growth last year showing that businesses are shifting meaningful payment flows onto real-time rails.

“While Pix was launched to address consumer and person-to-person needs, the consumer-led adoption created the conditions for commercial use,” PYMNTS wrote. “As faster payments became ubiquitous, businesses embraced the same rails to move money with greater speed, certainty and visibility.”

Brazil also remains Latin America’s “clearest beacon for digital payments at scale,” PYMNTS wrote earlier this year, pointing to research showing that 61% of Brazilian shoppers had used a mobile phone to for purchases, the highest rate among countries surveyed.