Belvo receives license from Brazil's central bank and expects to start paying this year

September 26, 2022
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The Latin American platform for Open Finance APIs, has just received authorization from the Central Bank (BC) to act as a payment institution (PI), in the mode of payment transaction initiator (ITP).

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It is the first step for the service to be launched, and the forecast is to put it in operation still this year, according to Albert Morales, general director of the company in Brazil, exclusively to Finsiders.

As we have already mentioned in several articles here on the portal, the ITP is a license created by the regulator as part of phase 3 of Open Finance. In practice, this figure allows the initiation of a payment transaction, at the request of the user and with his consent. The service initially works via Pix, but the Open Finance schedule foresees other payment methods, such as TED and DOC.

In Belvo's case, Albert had already told Finsiders in May that it was in line to receive approval for the payment initiator. Now that the license is out, the fintech needs to perform a set of tests, homologations and meet the necessary certifications for the service to actually become operational under Open Finance.

"As we knew that the license could come out, we had already been preparing from the point of view of security, compliance and product suitability. We have all the regulatory issues, such as certifications and test tracks, but we are already robust," says Ana Luiza Martins Castro, strategy leader for Open Finance and Payments at Belvo in Brazil. "We have a previously developed product and contact already with some customers."

According to Albert, the goal is to have the payments startup in production by the end of the quarter and to be operating still in 2022. "It's ambitious, because it depends on authorizations. But the trickiest part is behind us. From the security point of view, we have already done a lot," he emphasizes.

Belvo's idea is to explore different use cases with payment initiation, far beyond check-out in e-commerces. The executives give as examples recurring, batch payments and transactions in the world of legal entities (PJ). Another case is cash-in at investment brokerage accounts, which often still rely on transfers via TED.

"There are several use cases that customers want a plug and play solution, with the entire journey," says Ana. "We will provide the entire UX layer, compliant with the defined guides, and even the front-end," adds Albert.


Background

Founded in 2019 by Spaniards Pablo Viguera and Uri Tintore, Belvo arrived in Brazil in 2020. The company has a portfolio of more than 200 companies in the three countries (Brazil, Mexico and Colombia) - 150 in Brazil alone. In the client list are names like Mercado Livre, Tribanco, Rappi, Intuit, Mobills (from Santander), and Conta Azul, among others.

Currently, Belvo's platform has connections with more than 60 institutions, including large banks such as Banco do Brasil (BB), Bradesco, Itaú, digital banks like Nubank and Inter, as well as players in the gig economy, such as Uber and Rappi.

In late August, the company announced a capital injection (of undisclosed value) from Citi Ventures, the investment arm of Citi. Since its inception, the fintech has raised $56 million in investment rounds. In the captable are investors like Visa, Kaszek, Maya Capital, Future Positive, Kibo Ventures, FJ Labs, as well as angels like David Vélez (Nubank) and Sebastián Mejía (Rappi).

In Mexico, Belvo recently received the regulatory license Institution of Electronic Payment Funds (IFPE), an equivalent to the Brazilian ITP, to develop the payment initiation service in the country. It is also working to have similar authorization in Colombia, another country where it operates.

"The base is already being built. [Payment initiation] is not something we are starting from scratch," notes Albert.


Payment initiation

The executive recalls that the fintech has been participating in Open Finance working groups in Brazil and recognizes that the payment initiation service needs to mature. "We already know all the technical fights, what works and what doesn't. There are still technical interoperability challenges," he exemplifies.

Not surprisingly, the list of institutions able to operate payment initiation in Open Finance is small. According to the latest update of the Governance Structure, the group currently gathers 12 institutions, with Banco Mercantil do Brasil, Sicoob, and Hub Pagamentos (from Magalu) being the most recent ones. Banks such as Banco do Brasil (BB), BTG Pactual, Itaú Unibanco and Inter are also eligible, as well as fintechs Celcoin, Gerencianet, Parati and Quanto.

In full operation, Mercado Pago is a case apart because it already offers the functionality to 100% of its 10 million seller base and has also released cash-in for all app users, as Finsiders recently revealed. In e-commerce, the tool is released to 20% of the digital bank's customers, which is still planning to expand to the entire base.

Fintech Magalu is launching its payments startup on Kabum!, a technology and games e-commerce acquired last year by Magalu. "We're going to do a pilot now with a restricted Kabum! base, and then the idea is to make it available to the entire base," Fabio Murakami, director of PF and BaaS products at Fintech Magalu, told Finsiders in an exclusive interview two weeks ago.

Original article in Finsiders

Las opiniones compartidas y expresadas por los analistas son libres e independientes, y de ellas son responsables sus autores. No reflejan ni comprometen el pensamiento u opinión de Latam Fintech Hub, por lo cual no pueden ser interpretadas como recomendaciones emitidas por la platafomra. Esta plataforma es un espacio abierto para promover la diversidad de puntos de vista sobre el ecosistema Fintech.

It is the first step for the service to be launched, and the forecast is to put it in operation still this year, according to Albert Morales, general director of the company in Brazil, exclusively to Finsiders.

As we have already mentioned in several articles here on the portal, the ITP is a license created by the regulator as part of phase 3 of Open Finance. In practice, this figure allows the initiation of a payment transaction, at the request of the user and with his consent. The service initially works via Pix, but the Open Finance schedule foresees other payment methods, such as TED and DOC.

In Belvo's case, Albert had already told Finsiders in May that it was in line to receive approval for the payment initiator. Now that the license is out, the fintech needs to perform a set of tests, homologations and meet the necessary certifications for the service to actually become operational under Open Finance.

"As we knew that the license could come out, we had already been preparing from the point of view of security, compliance and product suitability. We have all the regulatory issues, such as certifications and test tracks, but we are already robust," says Ana Luiza Martins Castro, strategy leader for Open Finance and Payments at Belvo in Brazil. "We have a previously developed product and contact already with some customers."

According to Albert, the goal is to have the payments startup in production by the end of the quarter and to be operating still in 2022. "It's ambitious, because it depends on authorizations. But the trickiest part is behind us. From the security point of view, we have already done a lot," he emphasizes.

Belvo's idea is to explore different use cases with payment initiation, far beyond check-out in e-commerces. The executives give as examples recurring, batch payments and transactions in the world of legal entities (PJ). Another case is cash-in at investment brokerage accounts, which often still rely on transfers via TED.

"There are several use cases that customers want a plug and play solution, with the entire journey," says Ana. "We will provide the entire UX layer, compliant with the defined guides, and even the front-end," adds Albert.


Background

Founded in 2019 by Spaniards Pablo Viguera and Uri Tintore, Belvo arrived in Brazil in 2020. The company has a portfolio of more than 200 companies in the three countries (Brazil, Mexico and Colombia) - 150 in Brazil alone. In the client list are names like Mercado Livre, Tribanco, Rappi, Intuit, Mobills (from Santander), and Conta Azul, among others.

Currently, Belvo's platform has connections with more than 60 institutions, including large banks such as Banco do Brasil (BB), Bradesco, Itaú, digital banks like Nubank and Inter, as well as players in the gig economy, such as Uber and Rappi.

In late August, the company announced a capital injection (of undisclosed value) from Citi Ventures, the investment arm of Citi. Since its inception, the fintech has raised $56 million in investment rounds. In the captable are investors like Visa, Kaszek, Maya Capital, Future Positive, Kibo Ventures, FJ Labs, as well as angels like David Vélez (Nubank) and Sebastián Mejía (Rappi).

In Mexico, Belvo recently received the regulatory license Institution of Electronic Payment Funds (IFPE), an equivalent to the Brazilian ITP, to develop the payment initiation service in the country. It is also working to have similar authorization in Colombia, another country where it operates.

"The base is already being built. [Payment initiation] is not something we are starting from scratch," notes Albert.


Payment initiation

The executive recalls that the fintech has been participating in Open Finance working groups in Brazil and recognizes that the payment initiation service needs to mature. "We already know all the technical fights, what works and what doesn't. There are still technical interoperability challenges," he exemplifies.

Not surprisingly, the list of institutions able to operate payment initiation in Open Finance is small. According to the latest update of the Governance Structure, the group currently gathers 12 institutions, with Banco Mercantil do Brasil, Sicoob, and Hub Pagamentos (from Magalu) being the most recent ones. Banks such as Banco do Brasil (BB), BTG Pactual, Itaú Unibanco and Inter are also eligible, as well as fintechs Celcoin, Gerencianet, Parati and Quanto.

In full operation, Mercado Pago is a case apart because it already offers the functionality to 100% of its 10 million seller base and has also released cash-in for all app users, as Finsiders recently revealed. In e-commerce, the tool is released to 20% of the digital bank's customers, which is still planning to expand to the entire base.

Fintech Magalu is launching its payments startup on Kabum!, a technology and games e-commerce acquired last year by Magalu. "We're going to do a pilot now with a restricted Kabum! base, and then the idea is to make it available to the entire base," Fabio Murakami, director of PF and BaaS products at Fintech Magalu, told Finsiders in an exclusive interview two weeks ago.

Original article in Finsiders

Las opiniones compartidas y expresadas por los analistas son libres e independientes, y solamente sus autores son responsables de ellas. No reflejan ni comprometen el pensamiento o la opinión del equipo de Latam Fintech Hub y, por lo tanto, no pueden interpretarse como recomendaciones emitidas por la plataforma. Esta plataforma es un espacio abierto para promover la diversidad de puntos de vista en el ecosistema Fintech.
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