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The 9th �鶹�� Evidence Lab survey of 465 merchants across Brazil during Sep-22 shows that, amidst a challenging macro environment (with higher policy rates) and price adjustments in the payments industry, merchants are increasingly price sensitive. All the price options gained relevance among the most important reasons both to choose and to switch acquirers. Better discount rate was the main factor to choose an acquirer for a higher number of merchants (54% of the surveyed base, up from 49% in Oct-21). At the same time, lower merchant discount rates (MDRs) charged (for 60%), followed by lower fees on anticipation of receivables (33%) are the main reasons to switch acquirers. This suggests that any marginal tweak in prices (up or downwards) going forward might be really important for market share gains during 2023 (much more than client service levels or any other feature offered).

To understand the main attributes for choosing the acquirer, we asked merchants the reasons for choosing one acquirer over another. Overall, all the options related to prices gained relevance and were the most important reasons to choose one acquirer over another. Better discount rate became even more important in the latest survey, with 54% of merchants saying it was the most important factor when choosing the acquirer (from 49% in Oct-21), followed by better POS price (at 22%, from 17% in Oct-21). Additionally, amidst an environment with higher policy rates and price adjustments from the whole sector, we noticed that anticipation rates gained further relevance, being the most important factor for 17% of merchants (from 13% in Oct-21), and became the third most important reason, surpassing relationship with bank (at 15%), which was the second most important factor in Oct-21 (for 20% of merchants). Larger brand acceptance was the most important factor for 8% of respondents (from 6% in Oct-21), client service for 8% (from 9% in Oct-21) and better POS equipment for 6% (from 5% in Oct-21).

When we asked merchants the top reasons for switching acquirer, the main reason continued to be lower MDRs charged, despite at a slight lower level (for 60% of merchants, from 61% previously). Lower fees on anticipation of card receivables were once again the second most important factor to switch and gained further relevance, for 33% of merchants (from 28% in Oct-21), followed by POS free of charge. The advance on the relevance of lower fees of anticipation of card receivables to switch acquirer was expected in this moment of price adjustments (due to higher funding costs).

Interestingly, "Better service provided" was the answer for 18% of merchants (from 11% in the last survey). Credit offering would be the reason for only 8% (still, advancing from 5% last year). Credit might not be so relevant as of today because 1) credit offering is perceived today as more attractive from the banks than from acquirers; and 2) most acquirers still keep a conservative approach with credit disbursements, given recent macro uncertainties and NPLs rise.