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The future of finance in LatAm & the Caribbean

O futuro das finanças na América Latina e no Caribe



Brazil’s BS2 looks to new business models under open banking

Nov 1, 2021

By Roberta Prescott



Brazilian bank BS2 aims to develop new business models and services by signing up to Brazil’s open banking framework


As Brazil launched the third phase of open banking on Friday (Oct 29), digital bank BS2 joined the country’s biggest financial institutions in the new framework.

Phase three will drive a range of new services and new business models, the bank says, making it a good time to step into open banking.

“It will allow the emerge of new business models. We will see companies positioning themselves as platforms, once open banking facilitates the information exchange and an expanded ecosystem connected by APIs,” Fernando Radunz, CIO at BS2, told iupana.

Phase 3 facilitates payments and lending for Brazilians, starting with Pix. Banks are required to initiate payment transactions and forward loan applications, in line with customer requests.

“As it allows different apps and systems to initiate payments on third-party platforms, it will provide customers a more fluid journey,” he said

Because BS2 is not one of Brazil’s biggest banks, it was not required to participate in phase two – although phases one and three are mandatory for the digital bank, which provides financial and technology solutions for companies and individuals.

However, Radunz said BS2 is also working on being compliant with phase two by the end of this year.

“It’s under development. We are evaluating the best strategy to jump into phase two, including, using our own past experience in partnerships, for instance, Contabilizei,” the CIO said.

See also: Brazil’s BV Bank leverages open finance to expand distribution

Open banking use case: BS2-Contabilizei

Contabilizei is an online accounting service for small and micro enterprises. Last year, both companies announced a partnership under which Contabilizei’s new and existing customers could automatically open a BS2 digital account, without the need for new registrations or uploading documents.

It’s an open banking use case, said the CIO, while explaining that BS2, with the client’s consent, uses the information from the onboarding process at Contabilizei to automatically open the digital account.

“With this partnership we experienced the essence of open banking, although it does not follow standards set by BCB for open banking,” Radunz said.

Of the 60,000 corporate bank accounts held at BS2, some 15,000 to 20,000 were opened through the partnership with Contabilizei, he said.

Phase three will further open the opportunities. For example, clients will be able to pay bills, make transfers and Pix while on the Contabilizei platform, with no need to exit it, he said.

BS2 is keen to sign new partnerships. “Our products already provide a one-stop-shop; and you can access them all in our superapp,” he said, adding that open banking will enhance access to information.

“Open banking will boost the opening of new accounts and will facilitate customization for better products.”

And the medium-term prospects are huge, he said.

“Open banking has a disruptive power and it will revolutionize the industry. Five years from now, banks will be totally different and sharing data will be as easy as today it is to make a Pix.”

See also: CBDCs: Brazil’s central bank advances “real digital”

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