Warburg Pincus Invests $100M in Matera to Boost US Instant Payments, Aiming to Match Brazil’s Pace

It’s no exaggeration to declare the Pix instant payment platform, launched by Brazil’s Central Bank, a phenomenal triumph.

Pix enables direct monetary transactions across the main banking frameworks of various banks. Its widespread adoption has been noteworthy, providing everyday citizens, including street vendors, the convenience of making payments via their smartphones. As of the beginning of this year, it’s been reported that roughly 153 million people in Brazil (about 75% of its population) and 15 million businesses are utilizing Pix.

Pix’s overwhelming success has stimulated growth among enterprises involved in the underlying technology. Take, for instance, Matera, a firm based in Brazil that delivers software for instant payments, QR code payments, and core banking functionalities to financial entities. Matera equips institutions with the necessary tools for processing Pix transactions, including sending and receiving funds, assigning aliases, and generating QR codes.

As transactions shift from credit cards to Pix, not only do the major payment networks see a decline in their market presence, but entities like Matera, which facilitate these instant banking payments, are on the rise.

Since Pix’s launch in 2020, Matera has seen remarkable growth, increasing its revenue by four times to reach $77 million in 2023, a 30% increase. It’s unusual for a company established in 1987 to experience such significant growth decades later.

Matera has recently secured a $100 million investment from Warburg Pincus, which now holds a minority share in the firm, as exclusively reported by TechCrunch.

Comparable to U.S. core banking providers like FIS, Fiserv, and Jack & Henry, Matera is now aiming to expand its footprint in North America, focusing particularly on digital twin and QR code payment solutions, despite not introducing its core banking services in a market with established players.

“Our solutions aim at enhancing financial institutions’ operations by complementing existing core banking systems, rather than replacing them,” stated Carlos Netto, Matera’s CEO and co-founder. He highlighted Matera’s ambition of bridging the gap in instant payments between the U.S. and Brazil, emphasizing the importance of simplifying complex legacy systems.

Matera has chosen to partner with Warburg Pincus to leverage its expertise and foray into the U.S. market effectively.

The U.S. government’s instant payment mechanism, FedNow Service, launched roughly a year ago, has witnessed a gradual adoption.

Matera boasts nearly 500 million monthly Pix transactions, a figure expected to double soon thanks to a recent agreement. Currently, it serves about 280 clients, spanning top global and U.S. banks and a significant portion of Brazil’s banking sector. Matera has adopted a subscription model from its inception, with fees varying according to transaction volumes and other metrics.

Matera’s workforce has grown from 900 to 1,100 employees within the last year.

Henrique Muramoto, Warburg Pincus’ managing director, noted his firm has monitored Matera closely since the introduction of Pix, praising Brazil’s leading role in advanced payment infrastructures and Matera’s pivotal position within this landscape.

This piece has been updated after its initial release to note Warburg Pincus acquiring a minority stake in Matera.

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