Trump's trade war targets Brazil's payment rail

• Key insight: Trump plans a 25% tariff on most Brazilian exports, citing the role of the country's Pix payment rail as one of the reasons. 
• What's at stake: Pix has become Brazil's most popular option for digital payments. 
• Expert quote: "These tariffs could have a much broader impact on payments than people realize, particularly if Brazil's Pix system is part of what the U.S. is targeting. Pix is Brazil's government-run instant payment network, which is free for consumers and costs businesses very little to use," —Teymour Farman-Farmaian, co-founder and CEO of Higlobe, a Palo Alto, Calif.-based cross-border payment firm.

President Trump's global tariffs have reached Brazil's government transaction network, a fresh reminder of the impact of politics on cross-border payments.

The administration's 25% tariffs on most Brazilian imports are scheduled to take effect Wednesday. The levy, which includes several references to Brazil's Pix payments system, is the latest of numerous Trump moves that target parts of the global payments industry, though many of these moves did not happen or did not have a major impact.

While the fate of Brazil's new tariffs is still to be determined, there is the potential to disrupt a major flow of funds. PIX controls a large portion of Brazil's payments market, and Brazil has threatened retaliation.  

"These tariffs could have a much broader impact on payments than people realize, particularly if Brazil's Pix system is part of what the U.S. is targeting. Pix is Brazil's government-run instant payment network, which is free for consumers and costs businesses very little to use. Teymour Farman-Farmaian, co-founder and CEO of Higlobe, a Palo Alto, Calif.-based cross-border payment firm, told American Banker 

A new toll

The Brazilian announcement from the United States Trade Representative said the Brazilian tariffs follow a yearlong investigation that determined that "certain Brazilian measures" related to digital trade and electronic payment services are "unreasonable." The tariff cites Section 301 of the Trade Act of 1974, a law the Trump administration is using to impose tariffs after the Supreme Court struck down Trump's legal justification for the initial tariffs in 2025.  

"Today's action is necessary to address these unfair trade practices to ensure American workers and companies can compete on a level playing field. Extensive negotiations with Brazil over the past year have not resolved these issues, but we remain open to continuing negotiations with Brazil to bring about long-needed changes to the problems identified in this investigation," U.S. Ambassador Jamieson Greer said in a release.

The political backdrop involves Brazilian President Luiz Inácio Lula da Silva, who blamed the tariffs on Sen. Flávio Bolsonaro, a candidate for president in Brazil who is also the son of former president of Brazil and Trump ally Jair Bolsonaro.

A second USTR release quoted Secretary of State Marco Rubio, saying "President Lula and his government have not negotiated with the U.S. in good faith. His economic policies are bad for Americans and bad for Brazilians. For the past year, Lula has put his own ego ahead of making a deal for the welfare of the Brazilian people, and these tariffs are the price for that."

The USTR  investigation also found Pix "unfairly disadvantaged U.S. companies." 

Visa and Mastercard have accused Brazil of favoring Pix. Brazil's government subsidizes Pix, covering the payment fees that the U.S. card brands and other foreign payment companies charge. Brazil's central bank, Visa and Mastercard did not return requests for comment.

In a social media post, Lula da Silva said, "We have shown that the allegations against Pix and the regulation of digital platforms are unreasonable, as well as the accusations about deforestation [part of Trump's justification of Brazil's tariffs centered on energy policy]. Pix is a heritage of our people and an international reference for digital public infrastructure."

A national giant

Pix, which is similar to the U.S. FedNow real-time payment rail, became the most popular online payment method in Brazil in 2025, covering 42% of e-commerce purchases versus 41% for credit cards, according to EBANX, a Brazilian fintech that processes 33% of Pix's Brazilian payments. EBANX's data, based on its own analysis and Brazilian central bank data, also said that by 2028, Pix is on pace to reach 50% of e-commerce payments compared to 36% for credit cards. Pix accounted for $25.2 billion in 2021 — its first year in operation, with 2026's activity on pace to pass $187 billion in 2026 and $258 billion by 2028. 

Cards are also growing in Brazil at a 6% compound annual growth rate, according to EBANX, which estimates cards are expected to move $166 billion in Brazilian e-commerce in 2026, reaching $183 billion by 2028. Micro-businesses account for 79% of the companies that paid with instant transfer on EBANX merchants, and 48% of them identify as individual entrepreneurs.

Like numerous national systems, Pix is positioned as an alternative to U.S. cards and digital wallets. What the tariff debate highlights is a broader trend: Payment infrastructure is increasingly viewed as part of a country's economic sovereignty, Sebastian Fantini, global product director at EBANX, told American Banker, noting systems such as Pix in Brazil and UPI in India were built to address local needs, making payments faster, more affordable and more inclusive. "Their development also shows how much payment innovation is now coming from emerging markets, which have completely different needs than countries like the United States," Fantini said. 

The financial impact of Trump's Brazilian tariffs is also unclear. As with most of Trump's tariffs, there's an argument over who actually pays. In the case of Brazil, the tariffs would likely not impact Pix anyway, according to Fantini.

"Tariffs and payment systems operate on different layers of the economy, so we would not expect U.S. trade policies to have a direct impact on how Pix operates," Fantini said. "Pix is a domestic financial infrastructure regulated by the Central Bank of Brazil, while tariffs affect the movement and pricing of goods across borders."

If the goal is to pressure Brazil over a domestic payment system that competes with large American payments companies, that is deeply misguided, according to Farman-Farmaian. "The United States has its own public real-time payment infrastructure through FedNow, alongside private consumer networks like Venmo and Zelle. Brazil has simply developed its own model, and it has been extraordinarily successful," Farman-Farmaian said. 

There is also a broader geopolitical risk, according to Farman-Farmaian. "Using tariffs in a way that is perceived as protecting the interests of large American payments companies will push Brazil toward deeper economic ties with China," he said.