Within a week after WhatsApp payments was launched in Brazil. Brazil’s Central Bank has now suspended Facebook’s WhatsApp payments feature in the country.
As per Bloomberg reports. the central bank said that it had taken the decision to ensure competition in the payment system market. Bloomberg notes that the bank will use the suspension to evaluate potential risks to the country’s payment infrastructure, and to work out whether WhatsApp is compliant with regulation.
This Suspension in WhatsApp in the second biggest market is a blow for the Facebook’s payment ambitions.
Facebook had initially launched WhatsApp payments in India back in 2018.however Facebook struggled to gain regulatory approval for the service. Currently payment option is also tested in Mexico.
This WhatsApp service was free for individuals but would charge businesses @3.99 % processing fee. In countries like is India and Brazil WhatsApp serves as the main for form of online presence for many small businesses.
Over 5 million merchants around the world use the business version of the app according to Bloomberg.
As per Bloomberg reports, WhatsApp was surprised by the Brazilian Central Bank’s decision, as the company was in the regular contact with the authority.
WhatsApp had also started a small test of the service in the country around month prior to the launch.
“Our goal is to provide digital payments to all WhatsApp users in Brazil using an open model and we will continue to work with local partners and central bank to make this possible” WhatsApp said in a statement to Bloomberg. They also emphasized that it had plans to support the central bank’s instant-payment system, which is scheduled to launch in November.
Brazil’s Central bank has asked MasterCard and Visa to stop enabling payment and money transfers through the app, if they fail to do so they could face fine for noncompliance.
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