Brazil’s instant payment system Pix is poised to introduce a new recurring payments feature, Pix Automatico, scheduled for launch on June 16. This move aims to compete directly with credit and debit cards in Brazil.
Pix Automatico
According to the Central Bank of Brazil, which developed and operates Pix, users will be able to authorize recurring charges with a single consent under the new feature. This will enable automated payments for subscription-based services like utilities, gym memberships, and streaming services. While initially planned for October last year, the launch has been delayed without specified reasons.
Potential Impact on E-commerce
According to data from EBANX, Pix Automatico could handle at least $30 billion in e-commerce transactions within its first two years of operation. Since its introduction in 2020, Pix has become Brazil’s most popular payment method, utilized by over 90% of the adult population and more than 15 million businesses. Last year alone, the number of Pix transactions surpassed 80% compared to credit and debit card transactions combined. The total volume of Pix transactions last year was approximately 64 billion, marking a 53% increase from the previous year.
Weakening the Card Market
The new recurring payments feature could significantly impact Brazil’s credit card market. Many subscription-based services currently rely on storing credit cards on file, but nearly 60 million consumers in Brazil do not own a credit card. Pix Automatico not only diverts business away from credit card issuers; it also prevents many consumers from acquiring a card altogether. Compared to traditional recurring payments methods, Pix Automatico offers lower processing fees.
Future Innovations
Pix plans to further disrupt the credit card market by introducing a buy now, pay later option for its customers, expected to launch in September.
New Payment Architecture
Pix Automatico is set to replace the legacy Boleto system—a bank-slip payment method that has been in use for about 25 years. The new system aims to simplify the subscription process for small merchants looking to offer recurring payments. Under the previous setup, businesses were required to establish bank agreements with banks to provide automatic debit services.
The technical foundations of Pix Automatico will be managed by PagStream, a subscription management platform developed by PagBrasil, which processes payments in Brazil for multinational e-commerce businesses. Merchants can use PagStream to create and manage subscription plans, set billing frequencies, and automate customer communications around payment cycles. Although recurring charges are scheduled through PagStream, the actual transactions occur via Pix based on buyer authorization.
