Payments
What is a payout and what are the benefits of instant payout processes
Payouts can fasten and allow for many business and growth strategies for companies tapping into Brazil. Understand more about them and their benefits.
What is a payout and what are the benefits of instant payout processes
Mariana González Senior Marketing Analyst – PagSeguro Mariana González

A globalized and increasingly digital and connected world brings great benefits to companies and individuals – from customers and social media users, for example, to freelance service providers. Examples of this are markets such as influencer marketing, which has grown from US$ 9.7 billion in 2020 to a remarkable US$ 24 billion in 2024, besides remote and online work, social media, and digital entertainment options — including the fast-rising betting industry. A popular entertainment option for millions of users, the segment has a huge demand for efficient, fast payouts to pay for jackpots.

Behind these numbers is a combination of several factors: continuous evolution of personal computing and mobility; improvement in the quality, availability, and speed of fixed and mobile internet; expansion of the cloud; changes in the consumer profile and means of payment; and much more. Together, they make up a scenario of hyper-convergence of needs and means, where business opportunities arise and payments evolve.

Want to better understand what are payouts and how to improve the payment of cross-border transfers in your company? Keep reading our blog post to understand more about the goals and possibilities of instant payouts for worldwide merchants. 

What are payouts?

Before carrying on, let’s start with understanding exactly what payouts are. After all, this word is used in different situations, for different purposes, and it is necessary to know these differences so as not to create confusion – especially in the specific context of cross-border payouts, our focus on this blog post.

A disbursement, or a payout as it is commonly known, is defined as a payment made by a company to a non-employee for a service provided, including payment to ride-hailing app drivers, delivery app agents, home rental hosts, freelance service providers, influencers, streamers, betting app users, gamers, among others.

Traditionally, this process used to be subjected to many challenges such as remittance of capital, currency volatility, tax complexity, and processing delays, which can delay the distribution of payments to local providers. Furthermore, most global payment providers do not pay in local currency, leaving payees susceptible to exchange rate fluctuations and generating uncertainty about the final amount they will receive in Reais.

Finally, payees could be subjected to bank processing fees, which are not always clear, and taxes such as IOF – and take up to 3 business days to actually receive the payment, since traditional payouts are not instant, as it is possible today with more innovative solutions. 

Why count on an instant payout solution? 

In our 2021 white paper Brazilian E-commerce and Payouts, we showed how payouts in Brazil moved as much as US$ 18 billion in 2020, with around 12 million recipients in the country and a cross-border share of 29% out of the total volume. From then on, payouts only got more present, with more current data showing a US$ 23 billion volume in 2024 and an annual growth rate of 20% in Brazil.

One of the reasons for that is the establishment of freelance work offered online from anywhere in the world – from private classes to video editing, from graphic design to translation, among so many other options. For those looking to do business in the country, the scenario is highly favorable for hiring specialized professionals at attractive costs.

Besides, the rise of payouts also opened opportunities for creative, innovative engagement campaigns, such as play-to-earn – where gamers are rewarded for engaging with a mobile game, for example – and social media campaigns that reward users for posting content, inviting friends to join, and other engagement actions. All in all, payouts can fasten and allow for many business and growth strategies for companies tapping into Brazil. Let’s dive into other key factors behind that:

A borderless professional world 

The pandemic scenario coupled with some economic instability in the region has led to an increase in professionals working as freelancers and service providers in a huge variety of markets, reaching 1.5 million service providers on freelance work platforms in 2022 – or 1.7% of the Brazilians employed in the private sector.

For companies looking to operate in the region, this represents a wide range of qualified service options, something that is attractive for those looking to start or rapidly expand their operations here. In 2020, freelance platforms like Workana, Fiverr, and Upwork saw a rise of 120% in job requests, big opportunities available to be leveraged for companies that count on efficient payout platforms like PagSeguro’s.

More than that, the pandemic scenario made a growing culture even stronger: workplace flexibility, with people free to work from wherever they think fit. This allows companies to hire service providers from all over the world and creates a new necessity for easier, faster and better cross-border payouts. 

Digitization, connectivity, and mobility 

As an effect of the pandemic and the restrictions of movement and social contact, the use of cell phones in the country, which was already large, has grown even more and has put Brazil in 1st place in the world in this regard, with mobile connections reaching 96.3% of the population.

This means that Brazilians are buying, interacting, playing, and much more, all over the phone, generating a huge variety of business opportunities. From food and product delivery to courses and games, there is room for professionals to operate on several fronts, taking their services directly to the client through cell phones, tablets and computers.

The rise of betting apps

Payout processes are a must for the scalability and operation of betting merchants, which have an user base that is highly demanding of speed, agility, and transparency.

Our disruptive solution enables iGaming companies to send instant payouts to Brazilians in local currency within minutes through Pix or PagBank, with no integration required, no traditional banking fees, and fully in compliance with Brazil's regulations for betting operations.

Massive use of social networks 

From recommendations of good mechanics to reviews of the best restaurants, from posting memes to chatting for hours, a good part of Brazilians’ day is spent on social networks: there are 160 million users, with the possibility of reaching 180 million by 2025, according to Statista. When it comes to the streaming market, Brazil is the second largest in streaming platform Twitch, owned by Amazon.

For those who want to advertise their services or find suppliers, Brazil brings the ideal scenario in social networks for engagement and branding actions, like TikTok, which is already a PagSeguro's client and is the fastest growing social platform in Brazil in 2020, with more than 70 million users in the country.

The company uses payouts for influencers to promote their business and user engaging actions, like payment per watched video or per friend that joins the app through invitation. This is only possible by using a payment platform like PagSeguro’s Payout, that enables global companies to send instant payouts to Brazilians in a simple, efficient, and secure way. 

  • How PagSeguro can support and improve your payouts

  • To take advantage of the great opportunities the Brazilian scenario is now providing, with cross-border payouts forecasted to grow 29% per year, it is important to count on robust, specialized, and reliable solutions, such as those offered by our solution. PagSeguro Payout Solution enables merchants to send money from anywhere in the world to Brazilian payees, in their local currency (Reais), either through our all-in-one API or through our dashboard, with no integration required.
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  • This is a stable, innovative payout model with many benefits, which we’ll detail below. How can it help? Check out some of the main benefits that our solution offers to large companies that already rely on our expertise: 

Operational scalability 

Whether you need to make a single payment or several, regularly or sporadically, PagSeguro's Payout can fully meet your needs. This is because our technology ensures a robust system, prepared to process a wide variety of payouts at a time, up to 200 payouts per second and a total of 2 million payouts per day. 

Instant transfers in local currency

Local partners or service providers can easily receive their money within minutes after the 

request is made, directly at any financial institution through Pix or at their PagBank free digital account in Brazilian reais.

Cost-effective operation 

To strengthen the relationship with your best suppliers, making payments instantly and in local currency is an excellent practice - and our solution provides this for you. Traditional cross-border transfers can take up to as much as 3 days to clear the payment and often do so in foreign currency, bringing less transparency and more complexity into the process. In contrast, our product makes payouts instantly and in local currency, ensuring a fast and transparent receipt for your audience, an important differentiator to keep doing business. 

No hidden fees 

Better than getting paid quickly is getting paid the agreed amount without unexpected discounts or rate fluctuations, which is not always the case when using traditional payment methods. This is because banks apply a series of fees that will only be disclosed at the end of the operation, which consumes part of the amount to be received by your supplier. In addition, transactions made internationally may incur taxes, further reducing the partner’s receipts.

With our solution, costs are clear and lower than those of banks, which ensures not only a fast receipt but also higher than if other means were used. PagSeguro's Payout guarantees that there are no banking fees to the end users. 

No integration required 

Merchants who do not have the possibility or do not want to integrate via API can also use our solution. The requests can be done using our dashboard, My Account, in a very simple and practical way. For companies who want to integrate with us, the requests can also be sent via API. 

This brings reliability and solidity to management, while ensuring all the operational agility your company needs. Going beyond the payment advantages, our solution allows you to create unique cashback campaigns to incentivize your customers to cash out through our Payout and leverage your brand in Brazil. 

Uncomplicated cross-border operation 

We have 20 years of experience in Latin America and are experts in handling bureaucratic procedures of cross-border transfers, including conversions, fees, and compliance requirements. That is why merchants can trust PagSeguro to handle these complexities and remove any obstacles to international payments, enabling them to get the best of payments in the region. 

High level of compliance

Our operations are regulated by the Brazilian Central Bank and regulations from Latin America and America´s markets, such as LGPD and SOx law. Also, we are PCI DSS compliance certified, and all transactions undergo our Anti-Money Laundering & Combating the Financing of Terrorism (AML-CFT) analysis, which searches the name of the consumer in the OFAC Sanctions List. 

  • Simple and robust: this is the PagSeguro Payout ecosystem

With our flexible payout model and direct connection to PagBank’s ecosystem – the second biggest digital bank in Brazil –, we allow global companies to send single and mass instant payouts to Brazilians. Our payouts are sent directly in local currency within minutes, with no integration required and no traditional banking fees.

Besides the robustness of the system that brings performance to the solution, Payout was also designed to bring more simplicity of use, focusing on a positive and dynamic experience for the user. Therefore, the operation can be quickly completed in 5 simple steps:

  • Onboarding: The merchant goes through KYC process and signs the contract with us; 
  • Prefunding: The merchant adds balance to our account in USD, or uses the balance from processed transactions in Brazil to request the payouts; 
  • Operation: The merchant calls PagSeguro API to request a payout, or simply uses our dashboard, MyAccount, informing the payees’s selected payment method: Pix or PagBank; 
  • All done! Within minutes, the payment will be available: 
  • using Pix: at the payee’s bank account/e-wallet 
  • using PagBank: at the payee’s PagBank free digital account 

Balance Compensation Solution: payment processing and payouts in a single flow 

Another option to use our Payout solution and enjoy all PagSeguro’s tools to help you boost your business in Brazil is to use our Balance Compensation, which combines our two local payment solutions within a hybrid model – so you can use the balance from one solution to another, all in the same operation flow.

This way, we help you, a global company, to optimize and simplify your cross-border payment needs, making it easier to manage all the operations in one place, with a single integration.

To know more about PagSeguro Payout Solution and how to send mass instant payouts with no integration, click below to talk to us: 

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