🔍 What is a Payment Initiation Service Provider (PISP)?

A Payment Initiation Service Provider (PISP) – or ITP as it’s known in Brazil (Iniciador de Transação de Pagamento) – is a regulated entity authorized to initiate payment transactions on behalf of users, based on their consent.

Essentially, PISPs act as a bridge between the customer and their financial institution, allowing companies such as payment processors, acquirers, e-commerces, marketplaces, and delivery apps to start a payment directly from the user’s account, without handling the money themselves.

🧩 How Does It Work?

Once approved by the Central Bank (in Brazil) or equivalent regulatory body, a PISP gains the ability to:

Connect directly with users’ financial institutions.
Initiate transactions on behalf of the user, without needing access to their login credentials.
Ensure that funds are transferred directly from payer to payee.
Everything only happens if the user explicitly consents to the action.

📦 Real-World Use Cases

Here are some everyday scenarios where a PISP might operate:

💬 Messaging App Payments
Imagine a messaging app that’s certified as a PISP (like WhatsApp Pay). You’ve previously linked your debit card or bank account to the app. If you want to send money to a friend, you simply enter the amount and authorize the app to complete the transfer on your behalf.
🍔 Food Delivery App
Rather than entering credit card details into the delivery app, the app itself can initiate a payment directly from your bank account. After placing your order, the app instructs your bank to transfer the payment amount directly to the restaurant’s account.
🔐 Key Highlights
- ✅ User consent is mandatory for every transaction.
- 🔁 PISPs only initiate transactions – they do not hold money.
- 🚫 No need for traditional intermediaries like card processors or POS machines.
- 🏦 Transactions flow directly from the user's account to the recipient.

⚠️ Some important information:

The amount in the transactions will always be in cents, so 100 cents = 1 BRL.
There's a maximum amount of 1.99 BRL (199 cents) when testing our API.
The link is only for one use and expires at 5 minutes.
For specific information on the parameters, access the ITP object page.

🔍 What is Automatic Pix?

Automatic Pix is a new Pix modality, created to automate recurring charges, whether for fixed or variable amounts, and ensure receipt on the exact due date. It was developed to replace the Scheduled Recurring Pix, which did not deliver satisfactory results. Officially launched on June 16, 2025, Automatic Pix offers powerful tools to optimize collection operations.

🔒Key Benefits and Advantages:

Flexible Values: Allows scheduling of fixed or variable amounts, unlike the previous model which was only fixed.
Payment Retries: In case of settlement failure, the system allows up to 3 retries (in addition to the original attempt), totaling 4 attempts for the same payment, at the discretion of the recipient. The authorization for future payments remains even after a failure in the first attempt.
Improved Cash Flow Control: Ensures greater predictability and stability in revenues.
Reduction of Default Rates: Retries and automation contribute to reducing the non-payment rate.
Frictionless Experience: Offers a smoother and more secure payment process.
Automatic Redirection: The customer is automatically redirected to their bank's application to authorize recurring payments, eliminating the need for QR Codes or manually opening the application.
Lower Costs: Generally, costs are lower compared to cards or boletos, and payment is only made for successful transactions.
Enhanced Security: Payments are authenticated directly at the bank, ensuring security and reducing fraud.

📦 Use Cases

Automatic is ideal for various recurring billing situations, including:

Recurring service bills and invoices (water, electricity, internet, etc).
Loan installment payments.
Subscription services, such as streaming, VPN, or clubs.
Collection of school, university, course, and gym fees.

📰 Flow

Below, you can check the Sqala flow for Automatic Pix