Facebook’s bid to process payments in Brazil through its popular messaging platform Whatsapp has received a boost after the Brazilian regulator lifted the suspension it implemented a few days ago. However, Brazilian citizens are still not able to access the Whatsapp payment feature due to a ban by the country’s central bank. Whatsapp announced last month that it would be enabling payments on its platform for Brazilian users. Facebook CEO Mark Zuckerberg had said that transferring money would be as simple as sharing a picture.
Facebook partnered with Cielo to enable in-app payments.
WhatsApp’s parent company Facebook announced that it had partnered with local payments company Cielo to enable in-app payments. Brazil is Facebook’s second-largest market after India. WhatsApp would have access to hundreds of millions of users and over 10 million small businesses if the regulator did not ban the payment feature. A week later, the Brazilian regulators, after the launch of payment feature, clamped down on the company and suspended the payments. The central bank of Brazil froze all WhatsApp payments, claiming they posed a risk to the payments industry.
Brazilian regulator CADE reverses its ban.
Brazil’s antitrust watchdog, the Administrative Council for Economic Defense (CADE), and the country’s central bank placed a ban on Whatsapp’s payment feature. However, just a few days after the ban was announced, the regulator lifted the ban. The Brazilian regulator claims that after reviewing additional information from Facebook and Cielo, it determined that the two weren’t a threat to competition in the Brazilian payments industry. CADE noted that the social media giant had settled most of its initial fears and skepticism, but it will continue to investigate the partnership to ensure that there are no loose ends that the two companies can exploit.