caixa
Finance

Caixa CIO on opportunities and challenges in Brazil

George Washington Menezes is CIO of Brazil’s Caixa Econômica Federal, one of Latin America’s largest financial institutions and a company with roots dating back over 150 years. Caixa made headlines recently with the announcement of a huge satellite networking deployment to provide financial services and lottery access to Brazilians living in very remote locations. In an email interview I asked him about the BT deal and more.

 

The recent project with BT saw Caixa using satellite to connect lottery offices and provide financial services to Brazilians in remote places. Can you tell me more about it?

BT is a partner of Caixa, providing satellite communication services to 14,000 Lottery Outlets in approximately 5,600 Brazilian municipalities. In addition to receiving bets on federal lottery games, lottery outlets provide banking services such as withdrawals, deposits, and account balance inquiries, financial services such as payment of water, electricity and telephone bills and paying out of social benefits such as Bolsa Família (Family Allowance), PIS (Social Integration Program) and FGTS (Employee Severance Indemnity Fund).

Caixa’s lottery outlet network is the main bill payment receiver service in the Brazilian financial system and through it the social and financial inclusion of the population of all municipalities in Brazil is accomplished.

 

How is the project going and what are the next stages?

Currently Caixa has about 14,000 lottery outlets and 47,000 lottery financial terminals (LFT). All outlets are served by communication systems provided by BT. The contract allows the expansion of this network to the limit of 18,000 lottery outlets within the 60-month contract window.

 

Many telecoms providers around the world tend to be the old national incumbents. How is it that Caixa ended up working with a British telco?

As a publicly-owned financial institution, Caixa is subject to Brazilian laws regarding contracting. This law obliges Caixa to open competitive bidding processes for the procurement of goods and services. In 2005, Vicom, later acquired by Comsat, won the competition for supplying communication services to lottery outlets. In 2010, Comsat won the bid again, and was acquired by BT shortly thereafter. Finally, in 2015, BT was the winner of the bid again, signing a contract valid until August, 2012.

 

Are there any UK-Brazilian cultural challenges to overcome?

We believe that the cultural challenges in this process have already been overcome. The greatest difficulty we face in this type of contract is to understand the urgency imposed by the business characteristics and the provider companies’ logistic capacity to meet such demands. Owing to Brazil’s size and to the diversity of its geographic regions, the company has to be able to meet needs in every locality, maintaining the same level of service. Service in a small town deep in Amazonas State must be of the same quality as service in a big city like São Paulo.

 

Caixa is involved in many social projects using technology to help the disadvantaged. Can you provide more details?

Caixa Econômica Federal has recently launched the Bolsa Família (Family Allowance) application. The tool, available for free download on cell phones with the Android operating system, Windows Phone and iOS, has features that allow users, among other things, to check the allowance’s status, payment schedules and the bank’s branch network.

The Programa Bolsa Família (Family Allowance Program), considered the world’s largest cash transfer program, is targeted at families in poverty (with a monthly per capita income between R$ 77.01 (US $20) and R$ 154.00 ($40)) and in extreme poverty (with a monthly per capita income up to R$ 77.00). The program’s goal is to support and assist families in overcoming their vulnerable condition by ensuring their right to food, health, and education, among others. Bolsa Família currently aids over 13.9 million households across Brazil.

 

More broadly, what are the technical challenges of doing business in Brazil today?

The main challenge for Brazil concerning technology is monitoring new technologies and promoting innovation. Investments in research and development by businesses and government alike are needed in order to make the production of these technologies and the registration of their patents possible in Brazil.

 

Thinking about Brazil, how is national infrastructure developing in terms of ICT?

The ICT infrastructure has evolved considerably over the last decade. There are plenty of companies operating in this market, and there have been investments in communications, datacenters and IT development. As an example, we can mention the implementation of Caixa’s datacenters, CTC and CETAD, the latter built in conjunction with another Brazilian bank.

 

And your ability to hire people with good ICT skills?

According to Brazilian law, Caixa hires people through public competitive examinations, and, lately, people with ICT training have been hired through a specific competitive examination. It is also possible to hire consultancy, training and development of IT solutions services to fill the gaps in Caixa’s existing expertise.

 

Do you see Brazil potentially becoming a major centre for IT outsourcing or for tech-centric startups?

Yes, Brazil is on the road to becoming a great IT solutions generating hub. There is great enthusiasm and interest on the part of local IT companies, in addition to foreign ones established here. There is a high demand for qualification and good opportunities being offered in this sector.

 

 

Also read:

BT links remote Brazilians to lottery and money via satellite

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Martin Veitch

Martin Veitch is Contributing Editor for IDG Connect

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