Learn more about the boleto, a payment method used by millions of Brazilians.
Most Brazilians use boletos routinely to pay for products and services, as well as for essentials, such as electricity, water, telephone, taxes and more.
A boleto is a payment order payable in cash at any associated establishment by a set due date. Boletos can be paid at bank branches, lottery stores and supermarkets, as well as online using a PC or smartphone. It is a common practice, with on average 50 million boletos issued nationwide every month.
According to Forbes, Brazil is one of ten countries with the largest unbanked population, with nearly 50 million people without access to the banking system. In these countries, which generally are less developed and mostly located in Africa and Asia, ensuring access to bank services to all citizens is a major challenge. To Brazil’s unbanked population, transactions using boletos are even more common and critical for acquiring goods and services, since they do not need a bank account, as is the case of credit or debit cards.
Boletos have a barcode and corresponding serial number and include the transaction amount, the issuing bank’s code, customer data, a description and a due date. This data is used by issuer of the boleto to identify the payer.
Boletos in e-commerce
For many Brazilian e-shoppers, boletos are the only way to pay for products and services. Around 30% of all online purchases are made using boletos. However, two-thirds of Brazilians who use boletos for online shopping have bank accounts. In other words, boletos are preferred by some shoppers, even those with other payment options. The reason for this preference is also due to the fear of other credit card fraud, such as cloning, undue charges, etc.
For Brazilians consumers, boletos represent a secure payment method with a low risk of fraud and with the convenience of settlement via several physical and electronic channels.
Boleto transaction flow
Payment books are another way to use boletos
A payment book contains several boletos that are given or sent to the customer after the purchase. Each boleto corresponds to a monthly payment, effectively dividing the purchase full amount into installments. Payment books are commonly used for high-ticket items, such as cars, motorcycles, home appliances, etc.
The advantage of online merchant’s use of boletos is clear, given the possibility of reaching a large number of Brazilians who use this payment method. The method significantly helps to increase online conversion rates, while offering the possibility of integration with other payment methods in a single API.
For international new players, gateways or merchants, understanding the local payment culture and habits is crucial. Only by understanding the scenario can they develop a technological and commercial strategy for effectively reaching Brazil’s more than 100 million e-shoppers and raising sales conversion rates.