Brazil’s central bank effectively suspended a newly-launched system allowing users of Facebook’s WhatsApp messaging service to send money via chats, ordering Visa and Mastercard to halt payments and transfers via the system.
The central bank said in a statement that rolling out the service without previous analysis by the monetary authority could damage the Brazilian payments system in the areas of competition, efficiency and data privacy.
The system, launched last week in a nationwide rollout, allowed users to transfer funds to individuals or local businesses within a chat, attaching payments as they would a photo or video.
The central bank’s move is the latest setback in payments for owner Facebook, which pared back its plans for a global payments system called Libra after meeting stiff resistance from regulators. WhatsApp has over 120 million users in Brazil, its second-largest market behind India, where it has also struggled to roll out a payments system.