Brazil’s Pix payment system reshapes how millions pay — and puts Washington on edge

Few technologies have changed daily life in Brazil as quickly as Pix.

The instant payment system, created by the country’s central bank, has made cash nearly obsolete and brought millions of people who once lived outside the formal financial system into the digital economy.

Launched in 2020, Pix lets anyone with a bank account and a smartphone send or receive money at any time, free of charge. More than 90% of Brazilian adults — over 100 million people — now use it.

“It’s more practical,” said Patrícia Souza, a São Paulo resident. “I don’t need to carry a card or cash. I can pay anywhere with my phone.”

Pix is used for everything — transactions at street stalls, giving money to homeless people and shopping at supermarkets and major retailers. In one São Paulo department store, customers get about a 10% discount if they pay with Pix because businesses can avoid the high transaction fees charged by credit-card companies.

The system works much like Venmo or Zelle, but with two major differences: It is run by the Central Bank of Brazil, not private companies, and participation has been mandatory for all large financial institutions from day one.

“That made it possible for a lot of people in the country to transfer money virtually everywhere,” said Lauro Gonzáles, who researches financial inclusion at the Fundação Getúlio Vargas in São Paulo. 

Unlike credit cards, which are mostly used by the middle and upper classes, Pix has been embraced most strongly by low-income Brazilians. “That’s because lower-income people don’t have a lot of access to many of the other payment tools available,” Gonzáles said.

Before Pix, transferring money between banks could be slow and expensive, especially for people with limited means. By eliminating those fees, Pix opened digital finance to millions who had been left out of the banking system.

Its success, however, has created friction with Washington. Amid trade tensions with Brazil, the Trump administration launched a formal investigation earlier this year, alleging that the system gives Brazil an unfair advantage and could threaten US payment giants, such as Visa and Mastercard.

“If Pix is a government technology, and the central bank forces banks to use it, you could argue that’s unfair,” said Matheus Sampaio, a Brazilian researcher at Florida State University. “But what we found is that banks and credit card companies are benefiting, too.”

His research shows that Pix encouraged millions of Brazilians to open accounts, keep deposits and qualify for credit — expanding business for the entire financial sector. He said he sees Pix as an innovation that complements private banks rather than competing with them.

Some Brazilians worry about what happens to all that financial data under a state-run system. But Sampaio said he trusts the central bank’s safeguards.

“I prefer giving my data to a central bank that has regulations that do not allow it to be shared with other governmental authorities,” he said.

Still, privacy advocates warn that questions remain about how transaction data is stored and used in an era of growing digital surveillance.

For Gonzales, US concerns about Pix are more political than economic. “These arguments have no real financial justification,” he said. “They’re ideological.”

US President Donald Trump recently imposed a 50% tariff on Brazilian goods, citing trade imbalances and political interference. Yet, at the United Nations General Assembly last month, Trump and Brazil’s President Luiz Inácio Lula da Silva appeared to signal a thaw, shaking hands and pledging to meet. Trump later described Lula as “a very nice man” with “excellent chemistry.”

Whether that warmer tone will halt the US investigation into Pix remains to be seen.

Back in São Paulo, though, Pix is already part of daily life — a quick scan, a digital chime and a money transfer that’s quietly reshaping how Brazil pays, saves, and connects.