Brazil’s central bank told Visa and Mastercard to stop supporting mobile payments through WhatsApp after only one full week of operation, the latest blow to parent Facebook’s lofty financial services ambitions.
As all of WhatsApp’s partner banks provide the service through cards issued by either Visa or Mastercard, the order effectively suspends the service completely.
In a translated statement, Banco Central do Brasil said its move would give it time to assess the risks to the country’s financial settlement system SPB and compliance with various related laws.
It noted it made the move “to preserve an adequate competitive environment, which ensures the functioning of an interoperable, fast, secure, transparent, open and inexpensive payment system”.
The bank went on to cite concerns related to competition, efficiency and data privacy.
WhatsApp launched payments in Brazil last week to much fanfare, with Facebook planning to extend availability of the service to users around the globe. Its ambitions to provide payments over the app and its other brands have been regularly talked-up by CEO Mark Zuckerberg.
In May 2019, the executive said provision of mobile payments was part of his vision for the company, noting it was “one of the most important things we can do”.
Brazil was the first market with WhatApp payments available nationwide despite the service being trialled in India since early 2018, where it faced a number of hurdles.
India’s central bank finally cleared the service earlier this year with conditions, though a full launch is yet to be announced. Since the central bank gave its blessing reports emerged the country’s competition commission was assessing claims the service would fall foul of its rules.
Outside of mobile payments, Facebook has also faced criticism for its cryptocurrency plans.