Brazil has become the largest ecosystem for the exchange of data and financial services in the world

“Brazil will have the largest and best-connected Open Finance in the world,” said Roberto Campos Neto, president of the Central Bank (BC), at the close of Febraban Tech, an event held by the Brazilian Banking Association (Febraban) on banking technology last week.

The project is undoubtedly one of the most ambitious in the world. And it has already proven its worth, although it is only at the beginning of its journey.

Since March of this year, there have been more than 2.7 billion API calls, 800 million of them in the last four weeks of the first half of the year alone, with 19 institutions, including 13 major banks, reporting information. The number of API calls per week increased 171% since the count began on Mar. 5.

The data is included in the first biennial report of Open Finance Brazil, just published by the Initial Governance Structure.

In total, there are more than 6.7 million active approvals. However, that number is already higher, according to data Campos Neto presented at his Febraban Tech talk.

“Since our creation on Feb. 1, 2021, we have become the largest ecosystem for the exchange of data and financial services in the world, in terms of number of institutions and transactions,” Carlos Antonio Rodrigues Jorge, secretary general of Open Finance Brazil, writes in the material.

As he explains in the report, three of the four phases of the planned program have been implemented, albeit partially – from open data in Phase 1 to sharing customer information with consent in Phase 2 to introducing PIX payments in Phase 3.

According to the report, the overall success rate of API calls per week has remained above 85% since May 7 of this year but has already surpassed that level in May and June.

In the first half of the year, the account and credit card APIs were the most used by institutions participating in Open Finance in Brazil. There were 1.87 billion calls in the APIs of these products, representing 69% of the total. The rest included registration data, consent, resources, loans, and financing.

804 institutions participate in Open Finance, including 691 account holders, 531 recipients and/or transmitters of data (531), 35 payment triggers (but only 5 of which qualify for the productive sector), and 32 correspondents in the country.

Today, more than 600 people from different institutions are involved in Open Finance in Brazil. More than 25 technical groups (GTs) and squads are responsible for preparing studies and technical proposals according to the work plan established by the Council and the Central Bank.

POTENTIALS AND CHALLENGES

In the market as a whole, Open Banking has the potential to provide R$760 (US$146) billion in loans over ten years – R$460.7 billion, of which to individuals. By 2026, the number of personal loans would be R$94 billion. The projection comes from Serasa Experian.

In addition to consent, one major challenge is educating the population about the benefits that can be derived from data sharing.