Page 107 - ITU-T Focus Group Digital Financial Services – Interoperability

ITU-T Focus Group Digital Financial Services
Interoperability

3 Reported answers

Country: Brazil

Respondent: Central Bank of Brazil 8

Mandate Concerning DFS, the Brazilian Central Bank (BCB) has the mandate to regulate DFS in general.
The telecom regulator can regulate access to the mobile telecommunication infrastruc-
ture, which is clearly out of scope/mandate of the BCB. The BCB is also responsible for DFS
interoperability.
BCB’s mandate was established in 2013, when Law 12,865 was enacted.

State of the market Even before BCB’s mandate for DFS was established, banks and several non-bank payment
before authority’s service providers provided various DFS to the Brazilian market.
involvement Examples are: PayPal, Mercado Pago, PagSeguro (payment facilitators), Cielo, Rede (acquir-
ers), Oi Paggo, MFS (mobile payments), Alelo, Ticket, and Sodexo (food stamp providers),
among others. Banks also provided DFS, mainly through Internet banking and mobile banking
solutions.
Relevance assigned Interoperability is a major principle in the law that regulates the payment services provision
to interoperability in Brazil, as it is seen to be necessary for innovation and increasing competition.
Reason to address The Brazilian payment cards market was characterized by a high level of market concen-
interoperability tration. The two largest payment schemes had a combined share of approximately 90 per
cent of the payment cards market (both in transaction volume and value). The acquiring
market was also dominated by two acquirers (namely Cielo and Rede). It was pointed out in
the Report on the Brazilian Payments Card Industry (2010) that the verticalization of many
services by the acquirers were a major barrier to the entry of other acquirers. Additionally,
the highly concentrated financial market led to a concentration at the issuing side as well.
Furthermore, the involvement of the main financial institutions in all sectors of the payments
service provision chain (from scheme owners to payment facilitators) increased the chal-
lenges entrants must face.

Authority’s approach This is an ongoing process. In 2016, BCB decided to establish a working group with market
participants to discuss and promote interoperability in the Brazilian market. In its first task on
the operational side, the group discussed adjustments in the current interbank credit trans-
fers standards to cope with non-bank payment service providers; besides that, all payment
system providers guaranteed no technical obstacles for payment institutions to become par-
ticipants, so that all authorized market participants should have access to this set of transfers
as the adjustments are implemented.

Outcome An internal report on the first phase achievements of the interoperability working group is to
be finished by November 2016.

Country: Liberia

Respondent: Central Bank of Liberia 9

Mandate There has been no special agreement regarding the mandate on mobile payments between
the Central Bank of Liberia (CBL) and the Liberia Telecommunication Authority. However, the
Central Bank of Liberia mandated in its Mobile Money Regulation of May 14, 2014 that all
authorized institutions licensed under its regulations should provide systems that are interop-
erable with systems of other authorized institutions.

8 Central Bank of Brazil was represented by Mr. Ricardo Teixeira Leite Mourão.
9 Bank of Liberia was represented by Ms. Erica R. Williams.

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