The Central Bank of Brazil (BCB) has announced a plan to launch a new near-instant payment system during November.

Cointelegraph Brasil reported on Feb, 20 that the platform, called the Brazilian Instant Payment Scheme (PIX), will facilitate peer-to-peer and business-to-business transactions in 10 seconds or less via mobile phone, internet banking, or select ATMs.

According to a press release published Feb. 20, It is mandatory for all financial and payment institutions licenced by the BCB to provide their 500,000 active customer accounts with the functionalities required to facilitate PIX transfers.

The release states that transactions will be executed by using a QR Code, or by entering identifying information such as cell phone number, email or taxpayer identification number.

PIX designed in response to cryptocurrencies

According to local media outlet Livecoin, BCB President Roberto Campos explicitly stated that the platform is intended to compete against distributed ledger-based payment systems while speaking via video-conference at a launch event in São Paulo:

“Pix came from a need for people to have a payment instrument that is both cheap, fast, transparent and secure, If we think about what has happened in terms of the creation of Bitcoin, cryptocurrencies and other encrypted assets, it comes from the need to have an instrument with such characteristics."

Campos described the PIX platform as a top priority for the central bank during 2020. He added that PIX will be more efficient and “help to remove from people this need to have physical money, as this generates a great cost for society."

Speaking to Cointelegraph Brazil, the bank further stated that cryptocurrency firms will be allowed to join the platform and will experience no restrictions from BCB.

PIX to be used for tax payments

The BCB’s website states that the bank and the National Treasury Secretariat signed an agreement earlier this month that will see Brazilian citizens able to pay federal taxes using PIX from November 2020.

The release adds that the government intends to issue payments such as income tax refunds, social benefits and grants using the platform in future.

João Manoel Pinho de Mello, the director of the Central Bank of Brazil’s Financial System and Resolution Organization, predicted that PIX will comprise the catalyst for a financial revolution within the country, stating: “Instant payments will bring a major revolution in Brazil along with the other measures that the BC has been taking, open banking, for example.”