SAO PAULO — Brazilian authorities and companies have imposed nightly caps on PIX transfers from 8 p.m. until the following morning to limit large unauthorized transactions on the country's instant-payment system. Banks and regulators are also tracking and closing accounts tied to suspicious PIX activity.

Criminal networks have exploited the system by stealing phones and transferring tens of thousands of Brazilian reais instantly. The Brazilian Forum of Public Security estimates that between 24 million and 28 million people were victims of PIX-related crimes between January and September of last year.

PIX, governed by Brazil's Central Bank, launched in 2020 and processed $7 trillion in transactions last year. Of Brazil's 213 million residents, 178 million have registered for the service, which requires only a Brazilian bank account and is open to anyone with an individual taxpayer identification, registered companies or government entities.

The platform supports payments using QR codes and charges individuals no fees. Some banks charge companies for PIX transactions, but those fees are lower than regular bank transfers in Brazil, which can take hours. Many large corporations use PIX to pay workers, and houses, cars and helicopters can be purchased through the system, although large transfers often require bank approval first.

Ana Paula Siqueira, an expert on digital law, said the vulnerabilities lie outside the platform's infrastructure. "From the technical and legal standpoint, PIX is safe. But it is not immune to fraud because its risks are not in its technology; they are in people trying to fool others. The most common fraud involves psychological manipulation, fake IDs, urgent requests for payment." she said.

The system has become embedded in everyday commerce. "The best payment method is PIX, the most used. No one walks around with cash anymore, everyone just uses their phone, so they use PIX," said Luis Felipe de Almeida, a vendor of iced tea and cassava starch biscuits.

Restaurant owner Marcello Palladini uses PIX mostly to pay suppliers for transactions above 1,000 Brazilian reais because many suppliers do not accept credit cards for that amount. "When I want something quickly, I pay with PIX and it comes right away. I also do PIX with some suppliers who keep a tab and at the end of the month they send me a full bill," he said. Palladini added that "PIX works great, it is all instant."

A similar payment system in India processed $300 billion in payments in March and does not charge transaction fees. India's system, like PIX, is open to individuals at no cost per transaction.