Pix and ECB Explore Direct Cross-Border Payments Link

Brazil's central bank and the European Central Bank are exploring the possibility of linking Brazil's Pix instant payment system to the ECB's TARGET Instant Payment Settlement (TIPS) network.

The potential connection could allow for faster and cheaper cross-border payments between Brazil and Europe, reducing the need for intermediary banks and cutting out fees that can add up during international transfers.

Pix has been a game-changer in Brazil since its launch in late 2020, allowing people to move money instantly through banking apps at no cost for person-to-person transfers. Merchants also benefit from cheaper card payments, squeezing debit and credit card usage and putting pressure on networks like Visa and Mastercard.

The ECB is conducting a preliminary investigation into the feasibility of linking TIPS and Pix, which could lead to a 2028 pilot project. This would be a significant development in the world of cross-border payments, allowing banks to settle transactions directly in near real-time between Brazil and Europe.