By Adedapo Adesanya
Brazil has suspended the WhatsApp digital payments service in the country over trust concerns.
In a statement, the Central Bank of Brazil said it was taking the decision to “preserve an adequate competitive environment” in the mobile payments space and to ensure “functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap.”
Banks in the nation have asked Mastercard and Visa, which are among the payments partners for WhatsApp in Brazil, to suspend money transfer on the WhatsApp app.
It was added that failure to comply with the order would subject the payments companies to fines and administrative sanctions.
In the statement, the Central Bank of Brazil suggested it had not had the opportunity to analyze WhatsApp’s payment service prior to its rollout.
WhatsApp, which is owned by Facebook, is the most popular mobile messaging app in the world, with more than 1.5 billion monthly users globally.
Business Post had reported earlier this month that Brazil was the first country to get the in-app payment feature, which could be accessed directly within a conversation with a participating business, which was free for users.
Businesses were to be charged a small fee similar to a typical credit card transaction.
Brazil’s suspension of the feature will let the Central Bank evaluate the possible risk to the country’s banking system, including potential threats to “competition, efficiency and data privacy,” the central bank said.
In a response on Thursday, WhatsApp disclosed that Brazil’s monetary authority said it intended to find a way to restore the payments service in the country by working with Visa and Mastercard.
“The central bank made clear that they support platforms like WhatsApp that are innovating in digital payments,” Mr Will Cathcart, head of WhatsApp said in a statement.
