Everybody in the country can pay for anything instantly, with zero fees.

Brazil, digital payments, and the future of financial inclusion.

With regard to social equity, financial inclusion matters.

Bret Waters
3 min readApr 29, 2024


Brazil is a real hotbed of entrepreneurship and innovation these days — over half of Latin America’s unicorns (startups valued at over a billion dollars) are in Brazil. It’s also the largest economy in the southern hemisphere, and the ninth-largest in the world. It’s booming.

Three years ago the Central Bank of Brazil did a pretty amazing thing — it launched an digital payment system for the entire nation. Called Pix, anyone in the country can now create a unique user ID and use the system to send and receive money to anyone, for anything, instantly, with zero fees.

Imagine if the US government issued Venmo accounts to all 330 million people in the country, with the US Treasury settling every transaction within seconds, for free, 24/7. That’s essentially what Brazil has done with Pix.

And the adoption rate has been incredible: Within one year the Pix system handled 6 billion transactions totaling USD$682 billion, and now just three years after launch it has surpassed credit card traction volume across Brazil. Consumers love being able to make store purchases by just scanning a QR code, and merchants love not paying onerous credit card fees.

But most importantly, perhaps, is that with Pix the poorest people in the country now have access to some form of financial services.

As with many Latin American countries, historically the country’s banking system was controlled by just a few very large legacy banks. They used their market power to provide high-margin financial services to people with money, and had pretty much zero incentive to provide services to poor people. As a result, over half the population of Brazil was unbanked. In 2017, 53% of the population was unbanked — today it’s 3%. That’s a whole lot of financial inclusion to happen in just seven years.

Here’s the global point: with regard to wanting to help lift up the world’s poor, financial inclusion is a high-leverage opportunity. Banks have never cared about poor people, because they can’t make any money from them. But giving those people even just a tiny bit of access to the financial services the rest of us use can completely transform their lives.

It’s the reason why Muhammad Yunus was awarded the Nobel Peace Prize in 2006 for demonstrating that a bank can “create economic and social development from below”, instead of just focusing on customers at the top of the pyramid.

For me, this is probably the most exciting part of the entire fintech revolution — the ability to provide financial inclusion to the people who need it the most. The ones that traditional banks have never cared about.

For Brazil to have gone from 53% unbanked to 3% in just seven years is pretty amazing. Last month it was reported that Italy was in talks with the Brazilian authorities about replicating Pix in their country. This is potentially a revolution that could sweep the globe. No cryptocurrency required.



Bret Waters

Silicon Valley guy. Teaches at Stanford. Eats fish tacos.