Nubank accused of key fraud at PIX and Central Bank to investigate

Main fintechs in Brazil, Nubank and Mercado Pago are accused of fraudming Pix and registering key users without authorization. Central Bank states it will investigate

Nubank, one of Brazil’s leading digital banks, is being accused of fraud against Pix’s key registration system.

According to reports made by users on social networks Nubank would have registered the Pix key of its customers without their consent.

When asked by customers, the bank’s support would have said „no problem“ and that the customer could cancel the key at any time.

However, in addition to Nubank the fact would also have occurred with MercadoPago which is accused of having registered its customers at PIx without their consent.

According to data released by the Brazilian Central Bank, Nubank and MercadoPago were the institutions that registered the highest number of keys at Pix.

Central Bank

The complaint of customers with the improper registration of Nubank and MercadoPago in Pix reached the Central Bank which promised to take measures to punish possible irregularities.

„The Central Bank informs that it continuously monitors and supervises the process of registration of Pix keys, and has already initiated formal processes of participant surveillance. If it detects irregularities in these processes, including possible undue registrations, the Central Bank will punish the violators under the terms of the regulations in force,“ the Central Bank said in a statement.

However, the Central Bank did not say what the punishment would be if the irregularities were proven.

In their defence, both Nubank and MercadoPago stated that they only registered keys with the authorization of their users.

„Nubank informs that all the keys have been registered with the authorization of the clients. We have carefully prepared a practical and simple flow of communication and, on October 5th, we sent a request for consent via application to all customers who had pre-registered“.

„Mercado Pago clarifies that it does not register a Pix key without the user’s consent. The company reinforces that there is no registration without the customer’s consent approving the registration of their key in the Mercado Pago application.

Digital payments

The fight between institutions for the registration of keys in the Pix is not only a „war“ for customers but a battle for power in the system that should become the main means of digital payment in the country.

The Central Bank’s proposal with the Pix is to unify a whole ecosystem of digitalization of the economy that could even culminate in the creation of a Central Bank Digital Currency (CBDC) for Brazil.

In addition, within Pix, the Bitcoin Pro Scam wishes to allow decentralized withdrawals and even exchange operations.

In this line, recently, the president of the Central Bank, Roberto Campos Neto, said that the economic recovery of the country will happen through recent technological advances such as PIX and Open Banking.

On several occasions Campos Neto has already stated that the next phases of PIX involve foreign exchange, CBDC, tourism and what he has been calling „currency improvement“.

„In our case PIX is very important because we see from now on the union of an instant, open and interoperable form of payment with an open data system. Where it is at some point up front together with a currency that has to be perfected,“ he said.

So, according to him, the Central Bank has a project to simplify the exchange processes also to meet this demand.

„We have a project to simplify the exchange rate closing processes that will combine with a convertible currency,“ he said.