Brazil’s card industry association shifts power to major banks

The Brazilian Association of Credit Card and Services Companies (ABECS) held an extraordinary general meeting that brought sweeping changes to its bylaws. Amid important regulatory discussions, major banks have increased their influence over the industry association, which will also appoint a professional CEO. The move has drawn criticism from part of the market.

According to sources familiar with the matter, the industry had been working to broaden ABECS’s scope so that it would no longer focus solely on cards but also encompass other payment methods. Consulting firm Oliver Wyman was hired to help with the restructuring. Against that backdrop, major private-sector banks used the bylaw overhaul to consolidate their power. Their view was that because ABECS represents several different links in the payments chain, including many fintechs, discussions within the association had become bogged down.

ABECS will eliminate its board and create an executive committee, which is expected to be established within 90 days. It will be made up primarily of representatives of the five largest incumbent card issuers—Itaú Unibanco, Bradesco, Santander, Banco do Brasil, and Caixa—, the three largest acquirers—Itaú’s Rede, BB and Bradesco’s Cielo, and Santander’s Getnet—, and the three leading card networks, Mastercard, Visa, and Elo. Independent acquirers such as Stone, PagBank, and Mercado Pago will have less representation.

At the same time, an advisory committee will be created to facilitate ABECS’s integration with other industry associations. Stone, for example, belongs to Abipag; PagBank is a member of Abranet; and Mercado Pago belongs to Zetta. Under the changes, current CEO Giancarlo Greco, of Elo, is expected to remain during a transition period and leave once the new governance model is in place. The association will hire a market professional as CEO, following the model used by the Brazilian Federation of Banks (Febraban) and the Brazilian Association of Banks (ABBC). Current executive vice president Ricardo Vieira is also expected to leave his position. It is not yet clear whether he could be appointed to the new structure.

“The bylaw changes brought some positive developments, such as expanding the scope and strengthening ties with other associations. But the truth is that the major banks took advantage of the bylaw overhaul and steamrolled the process. Several different links in the chain participated in ABECS, and some discussions became deadlocked. Now power is more concentrated among the major issuers,” a source said.

As technology advances, the payments industry must adapt to changes that have emerged in recent years, from Pix, Brazil’s instant-payment system, open finance, and tokenization to more recent issues such as commerce conducted by artificial intelligence (AI) agents. The industry may also revisit a debate that divides some players in the chain over the particularities of Brazil’s card payments model, as the Central Bank has expressed concerns about the current structure.

ABECS declined to comment.