Brazil’s open finance gains traction, paves the way for new solutions | Business

“Institutional players are starting to understand that this is how you serve your client,” Ms. Abrão said in her first interview since taking office. “If a customer hasn’t opted into open finance, your ability to offer products and services is limited.”

Originally, open finance was designed to reduce information asymmetry in the financial sector. While there has always been competition among banks, they weren’t competing for the same customers because each had deeper insights into their client base. The open model sought to break that silo. Now that the system is in place, the next frontier is leveraging shared data to deliver better, more tailored services.

One of the upcoming developments is a credit “marketplace” where consumers will be able to access offers from multiple lenders.

The Central Bank has placed open finance among its top regulatory priorities for 2025–2026. In the near term, enhancements will focus on improving the system’s operational infrastructure, encouraging adoption by corporate clients, and making credit portability more seamless.

Portability will begin with personal loans, followed by payroll-deductible loans for federal employees and, later, other credit lines. “Right now, portability is the priority because of its impact and the complexity involved,” the association’s president said. One key issue still under discussion is how the new lender should compensate the original creditor for costs incurred in originating the loan.

In the medium term, Ms. Abrão envisions the rollout of a full-fledged credit marketplace. Customers who consent to share their financial data could receive proposals not only from their own bank but from competitors as well, fulfilling open finance’s promise of fostering competition and lowering borrowing costs.

“The Central Bank wants to create a credit marketplace within the open finance system,” she explained. “You’d go in and post a request—say, for a mortgage of a certain amount—and consent to receive offers. Then you’d be able to compare proposals, possibly organized by credit type.”

The marketplace would mirror the model launched this year for private payroll loans, available through the digital labor booklet (CTPS) app. But the open finance version would go further, offering proposals across multiple credit types and taking into account a customer’s entire financial history, not just their income and spending habits.

This vision aligns with a scenario once described by then-Central Bank President Roberto Campos Neto, who envisioned a “super app” that would consolidate existing banking apps. The idea sparked controversy at the time, with some interpreting it as an attempt by the regulator to compete directly with banks.

According to Ms. Abrão, the idea is that customers will eventually manage most of their financial lives through a single bank’s app, using open finance to access and control accounts held across multiple institutions. This trend, she said, aligns with the ongoing battle among banks to win what is known in the industry as “primary banking relationship” status—that is, to become the customer’s main provider of financial services.

With open finance, she noted, a bank can deliver more targeted product and service offerings if it has access to information such as a customer’s investments held with a competitor or if it detects that the customer is in the market for a mortgage.

“Primary banking doesn’t mean the customer will buy all their financial products from a single bank,” she said. “It means that through a single app, they’ll be able to manage accounts across institutions. Once banks adopt this mindset—make that shift—they’ll realize it’s better to become that central hub for the customer’s transactions. Banks that resist this shift risk losing relevance,” she said.

Some institutions, she noted, are adapting to this new reality, while others remain reactive.

Launched as “open banking,” the initiative was formalized in 2020 by Brazil’s National Monetary Council (CMN) and rolled out gradually from 2021 onward. Today, Brazil operates the world’s largest open finance system. “Brazil’s open finance framework was the fastest and most ambitious in terms of data sharing, and it even incorporated payments, all in a very short time,” Ms. Abrão noted.

Until now, the monetary authority has maintained hands-on oversight, even at the operational level. But as the system matures, its governance structure, composed of industry associations, will take on more autonomy.

Since January, open finance governance has had a permanent structure, led by a formal association. Ms. Abrão, nominated by Zetta, an association representing fintechs such as Nubank, received broad backing, including from the Brazilian Federation of Banks (FEBRABAN).

With a background in the financial sector, including stints at Itaú Unibanco, B3, and consultancy Tendências, Ms. Abrão also worked as a career civil servant at the Central Bank. She served as finance secretary for the state of Goiás. In 2017, while at Oliver Wyman, she helped launch some of the first projects in partnership with the monetary authority to bring open finance to Brazil.

She now leads the world’s largest open banking ecosystem, not only in terms of users—with 57.49 million active consents—but also by volume of API calls, which enable communication between financial institutions.

The system has grown organically, Ms. Abrão pointed out, without any major advertising campaign, neither from the Central Bank nor participating banks. “If we’ve reached 57 million consents with virtually no communication, I’m confident we can reach 200 million as people begin to see the benefits more clearly,” she said.

The association now plans to launch a dedicated website to leverage the visibility of the existing open finance portal and is preparing social media campaigns. Banks, too, are expected to promote the system more actively.

In some areas, use cases are becoming more tangible. In investments, for example, when customers share data, banks and brokerages often offer more profitable options. In payments, open finance has advanced with the integration of the instant payment system Pix—particularly through the use of payment initiation providers (ITPs), which link Pix to other functions powered by open finance, such as scheduled or automated payments.

Corporate adoption, however, still faces hurdles. One challenge is defining which employees have the authority to grant consent or move funds. “That’s a longstanding issue in the industry, not just in open finance,” the association’s president said. “We’re now debating how to resolve it. One option is to standardize rules across institutions, though that’s a slow and costly process. Another is to create a centralized database combining information from boards of trade and notaries about legal representatives and their powers.”

As open finance expands, it is also expected to connect with other data-sharing systems beyond the Central Bank’s jurisdiction—such as open capital markets, overseen by the Securities and Exchange Commission of Brazil (CVM), and open insurance, regulated by the Superintendence of Private Insurance (SUSEP).

According to Ms. Abrão, the open investment segment may eventually fall under the umbrella of the Open Finance Association. “In the second half of the year, we’ll hold a strategic planning session to chart the next phase of open finance, beyond what’s already planned.”

With the new governance model, the monetary authority no longer manages the system’s administrative structure but remains the regulator. It acts as an observer in several forums, receives proposals from the association, and has final say on rules. It may override decisions if necessary. “The idea was to allow the Central Bank to step back from the day-to-day. Until January, it was involved in weekly working group meetings because there wasn’t a permanent executive body,” she explained.

The association now has 140 employees and a R$170 million budget. Since there is no centralized database—data is exchanged directly between authorized banks—there’s minimal risk of breaches, she said. Still, as with any tech system, hacker attacks could disrupt communication. “Everything is cloud-based,” she noted.

When the monetary authority defined the governance structure in December, it had to resolve a dispute between large banks and smaller players, including fintechs. Larger institutions complained they were footing 80% of the bill but held just 17% of the votes. Smaller institutions argued that infrastructure costs are fixed, and tying contributions to fluctuating client bases would introduce instability and discourage participation.

The Central Bank opted for a middle ground. FEBRABAN was given two seats on the ten-member board, and contributions remain proportional to bank size, but are capped for the largest players. The remainder is distributed among the other hundreds of participants.

One unresolved issue is whether banks should be compensated for responding to data-sharing requests via API. The idea is that institutions incur costs—staff time, infrastructure—for each call. A system of payments could be introduced for usage that exceeds a defined threshold. “This debate resurfaces periodically,” Ms. Abrão noted. “Anything that’s free risks inefficient use. But the Central Bank initially resisted charging to ensure the system got off the ground. As the number of consents and the system’s maturity grow, I think the conversation will resurface.”