ECB to link TIPS with Brazil’s Pix for instant payments

The European Central Bank plans to connect its TIPS instant settlement service with Brazil’s Pix system to allow near-instant cross-border payments between the euro area and Brazil. Work is at an exploratory stage and involves technical and regulatory discussions between the ECB and the Banco Central do Brasil.

Officials from both central banks are pursuing a direct technical link so payments can move without routing through multiple correspondent banks. TIPS settles instant payments in central bank money across the euro area, while Pix processes immediate transfers through accounts held at Brazilian banks and the central bank’s infrastructure.

A connection would require agreed messaging standards, technical interoperability, and legal arrangements that set settlement finality and liability. Currency conversion and management of foreign-exchange risk would remain separate processes to be handled by participating banks or through dedicated liquidity arrangements such as payment-versus-payment (PvP) mechanisms or pre-funded lines to avoid settlement risk.

Operational integration would need aligned message formats, authentication and fraud-prevention tools, and automated reconciliation so beneficiary accounts can be credited without manual steps. Regulatory and compliance controls, including anti-money-laundering checks, sanctions screening and customer due diligence, would need to meet both jurisdictions’ standards. Time-zone differences and different operating hours for related systems add complexity.

Project planning is expected to include pilot phases that test end-to-end flows with a limited set of participants and transaction types. Next steps will include detailed feasibility work, drafting of legal and operational frameworks, and coordination among supervisors, payment operators and private-sector service providers. If technical and regulatory issues are resolved, pilot testing and gradual expansion of cross-border instant payments could follow.