Cielo Loses Historic Leadership in the 'Machine War' After Competitors' Advances, New Central Bank Rules, and Rise of Pix

Cielo Loses Historic Leadership in the ‘Machine War’ After Competitors’ Advances, New Central Bank Rules, and Rise of Pix

Written by Bruno Teles

Published on 09/08/2025 at 19:06

Guerra das maquininhas derruba margens e força Cielo a competir com fintechs que oferecem contas digitais, crédito e fidelidade

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How Did Cielo Lose Ground in the Payment Machine War? Intense Competition, Regulatory Changes, and New Technologies Challenged the Company’s Historic Leadership

For years, paying by card in Brazil was almost synonymous with using a Cielo payment machine. The company controlled more than half of the country’s transactions, sustaining robust margins in a practically closed market.

But the arrival of new competitors, the regulation from the Central Bank, and the rise of Pix changed the game. Today, Cielo struggles to remain competitive in a scenario where payment machines are merely the entry point to much broader financial ecosystems.

The Reign That Seemed Unshakeable

Cielo’s journey began as Visanet, focused exclusively on Visa transactions. On the other side, RedeCard, linked to Mastercard, served the rest of the market. This division forced merchants to maintain two payment machines, creating a duopoly that guaranteed high revenues and stability for both groups.

ARTICLE CONTINUES BELOW

The Central Bank Dismantles the Duopoly

Starting in 2010, the Central Bank and CADE determined the end of exclusivity among networks. Cielo began accepting Mastercard, and RedeCard (now Rede) started processing Visa transactions. The aim was to open the market, increase competition, and reduce costs for retailers.

The effect was swift: Stone, PagSeguro, Getnet, SafraPay, and Mercado Pago entered the market offering cheaper payment machines, without rental fees and integrated into modern apps. Thus, the so-called “payment machine war” was born, which lowered margins and expanded access to cards for freelancers and small merchants.

Pix and Receivables Registrars Change the Profit Source

In 2021, a new regulatory change removed control over receivable advances from acquirers. Any retailer could now advance their sales with any financial institution, increasing competition in this segment.

Alongside this, Pix gained massive adoption since 2020, reducing debit use and directly impacting the revenue of payment companies. Profit no longer relied on capturing transactions and instead depended on those offering complete packages with digital accounts, credit, investments, and loyalty programs.

Corporate Structure and Loss of Agility

Despite all the challenges, Cielo is still one of the largest in the country, with about 20% of the market, behind Rede, which leads with 22%. However, its control structure limits agility: the company belongs to Elopar, a holding divided between Bradesco and Banco do Brasil, which also controls brands like Elo, Livelo, Alelo, and Veloe.

In practice, any strategic change requires consensus between two banks that compete directly in the market. Meanwhile, competitors like Itaú—owner of Rede—and fintechs operate in a more integrated and agile manner, quickly adapting products and prices.

The Challenge of Reinventing Itself

In 2024, Bradesco and Banco do Brasil bought the remaining shares of Cielo and closed its capital, a move similar to what Itaú and Santander had already done with their acquirers. The idea is that outside the stock exchange, it will be easier to adjust processes without the pressure from investors.

But the central question remains: is it possible to transform a robust and traditional operation into an agile machine capable of competing with fintechs and vertically integrated banks? Today, payment machines are no longer the main product but rather the entry point for complete financial services, where value lies in integration and the smart use of data.

And you, do you think Cielo still has the strength to return to leadership, or does the future of the sector belong to fintechs? Share your opinion in the comments—we want to hear from those living this competition daily.

Cielo Loses Historic Leadership in the ‘Machine War’ After Competitors’ Advances, New Central Bank Rules, and Rise of Pix

How Did Cielo Lose Ground in the Payment Machine War? Intense Competition, Regulatory Changes, and New Technologies Challenged the Company’s Historic Leadership

The Reign That Seemed Unshakeable

The Central Bank Dismantles the Duopoly

Pix and Receivables Registrars Change the Profit Source

Corporate Structure and Loss of Agility

The Challenge of Reinventing Itself

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Cielo Loses Historic Leadership in the ‘Machine War’ After Competitors’ Advances, New Central Bank Rules, and Rise of Pix

How Did Cielo Lose Ground in the Payment Machine War? Intense Competition, Regulatory Changes, and New Technologies Challenged the Company’s Historic Leadership

The Reign That Seemed Unshakeable

The Central Bank Dismantles the Duopoly

Pix and Receivables Registrars Change the Profit Source

Corporate Structure and Loss of Agility

The Challenge of Reinventing Itself

A village with 115 inhabitants wants new residents: it offers a house, a job, up to 44 thousand euros in benefits, almost free rent, an annual grant of 8 thousand euros for 3 years, and a 20 thousand euro incentive for businesses in the mountains of Italy.

NASA is offering US$ 750,000 to people from anywhere in the world who solve a problem that could decide survival on Mars: creating food for astronauts without relying on resupply from Earth.

While countries spend billions to draw water from the sea, a Nobel-winning scientist creates a container-sized machine that extracts up to 1,000 liters per day from dry air and uses ultrasound to release water in minutes, even in the middle of the desert.

Belgium will sink 23 giant concrete caissons, each weighing 22,000 tons, in the North Sea to build the world’s first artificial energy island 45 km off the coast, forming offshore electrical walls.

New microwave that can replace three appliances hits the market: Sharp launches 3-in-1 model that combines air fryer, convection oven, and heating in 0.9 cubic feet for small kitchens

While Brazil has been discussing bullet trains for 16 years, China delivers 5 new high-speed lines in 2026, surpasses 50,000 km of HSR, and moves 1 billion passengers in a single year.

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