Earlier this month, Facebook-owned WhatsApp unveiled a digital payment system in Brazil, the company’s second-largest market after India. In a surprise move, Brazil has suspended the payments service a week after its launch.
In a statement, Brazil’s central bank said they had not had time to analyze the payment service before the rollout.
The bank also added that the decision was resolved in a move to “preserve an adequate competitive environment, that ensures the functioning of a payment system that’s interchangeable, fast, secure, transparent, open and cheap.”
The hasty move is also meant to avoid any “irreparable damage to the system, especially what concerns competition, efficiency and data privacy.”
The authority has also asked several WhatsApp Pay partners like MasterCard Inc. and Visa Inc. to suspend transactions done via the platform or face fines.
Brazil’s suspension of WhatsApp Pay is a hurdle to the company’s vision to roll out it out to more countries globally. To the service, regulatory issues have been one of the biggest hurdle so far in its quest to achieve this.
“Our goal is to provide digital payments to all WhatsApp users in Brazil using an open model and we will continue to work with local partners and the Central Bank to make this possible,” a WhatsApp spokesperson said.
The much-anticipated Indian rollout is yet to happen to date despite the various moves the company has made in the past to try and get past the regulatory speedbumps.
WhatsApp tested its in-app digital payments service in both India and Mexico two years ago.