Financial inclusion in Brazil: From unbanked to over-indebted?

Over the past 15 years, financial inclusion in Brazil has been advanced through a deliberate and proactive regulatory agenda, in which the Banco Central do Brasil (BCB) has played a key role. Rather than resulting from spontaneous market dynamics, the transformation of Brazil’s financial system reflects a sequence of regulatory decisions aimed primarily at increasing competition by incorporating new actors into the formal system. Through this process, the BCB helped establish the foundations of a broad and increasingly accessible digital financial ecosystem.

Brazil’s trajectory illustrates how financial inclusion at scale depends on regulatory sequencing, public infrastructure and public policies. Early reforms focused on dismantling exclusivity and market concentration in the payments sector. The 2010 decision by Brazil’s competition authority to end exclusive agreements between card brands and acquiring companies reduced barriers to entry and encouraged interoperability. Although not directly led by the central bank, this reform created the conditions for subsequent regulatory action. Building on this shift, the BCB introduced rules governing card fees and interchange rates, enhancing transparency and lowering transaction costs for merchants and consumers.