How Disinformation Is Undermining Trust In Brazil’s Most Used Digital Public Infrastructure

On the morning that Fernanda Torres and the movie “I’m Still Here” were nominated for the 97th Academy Awards, the Brazilian federal government was quick to celebrate with an X post. However, another post received more likes later that day: a repost of this official government content with the quote, “not the government being faster to talk about the Oscars than to address fake news.” This viral repost referenced the recent wave of disinformation concerning a new regulation around Pix, the country’s digital instant payment system, that affected over 9.4 million Brazilians between January 7th and 14th.

In September 2024, the Brazilian Federal Revenue Office enacted a norm that would expand an existing oversight system for conventional financial institutions to now cover digital banks, credit card operators, and Pix transactions. According to the government, the measure aimed to prevent tax evasion and money laundering: the information is transmitted from financial institutions to the tax authorities, who then cross-check this data with what taxpayers declare in their income tax returns. This new rule also raised the minimal amounts for transactions to be reported — from BRL 2,000 to BRL 5,000 for individuals and from BRL 6,000 to BRL 15,000 for businesses. It entered into force on January 1st, right before the second anniversary of the January 8 anti-democratic riots, when chaos began.

According to the digital monitoring platform Palver, more than 18,000 unique messages about the topic were shared in 2,200 Portuguese groups on WhatsApp and Telegram. This campaign falsely claimed the government was planning to tax Pix transactions, creating distrust and concerns about surveillance, particularly among small and medium-sized businesses. Democracia em Xeque Institute, on its turn, analyzed 1,793 posts on the matter that circulated on Facebook, Instagram, YouTube, TikTok, and X. Of this amount, 855 were shared by right-wing profiles and 846 by progressive profiles. However, interaction numbers revealed a more significant predominance of the former: across all analyzed platforms, users from this ideological spectrum dominated interactions on the topic.

On January 14, the federal government took its final blow: a viral video of right-wing Congressman Nikolas Ferreira criticizing the increased monitoring of financial transactions and saying that, although the new regulation would not tax Pix transactions, he "does not doubt" that the payment method could eventually be taxed. The video surpassed 310 million views and helped Ferreira surpass President Lula in the number of followers on Instagram, becoming the second most-followed Brazilian politician on the platform. Reportedly, it was also the main reason behind the government's ultimately revoking the new norm on January 15.

The aftermath: erosion of trust

Nevertheless, the societal, political, and economic impacts of the episode cannot be erased. Despite official clarifications from public authorities stating that no such tax existed, the false narrative spread rapidly, reaching all 67 area codes in Brazil. According to a Quaest survey that interviewed 1,200 Brazilians, 87% of Brazilians were exposed to misinformation about Pix, and around 67% believed that the federal government would actually impose a fee on financial transactions made through Pix. Among Brazilians who received the misleading content, only 68% later learned that the federal government had debunked the false information, and 31% were unaware of the correction. Regarding the revocation of the monitoring measure, 55% were informed about it, while 45% said they were unaware.

Following the episode, the number of Pix transactions experienced its largest decrease recorded for the first half of January since the instant payment system was launched in November 2020. Ethnographic data shows people’s distrust of the system in the aftermath. A peanut street vendor noticed that customers were avoiding paying through Pix even in the days after the new rule was revoked: “Everyone is scared to make Pix transactions. Customers prefer to pay in cash. Before, I used to make up to BRL 800 a day just through Pix transactions; now I am making only BRL150." And a shopper in Rio’s Saara neighborhood feared being surveilled: "We are being watched, especially our money. I am going to have to change the way I pay for things. I don’t know if I will deposit money onto this card to use Pix anymore.”

Moreover, the rise of new schemes designed through social engineering sounded the alarm to public authorities and journalists. Through WhatsApp messages that used the name and logo of the Brazilian Federal Revenue Office, fraudsters approached victims to collect the payment of the alleged fees on Pix transactions, claiming that the taxpayer's Individual Taxpayer Registry (CPF) would be blocked if the payment was not collected.

This situation mirrors the 2024 US elections, where public opinion on the economy remained negative despite positive indicators, highlighting the vulnerability of populations to financial mis and disinformation and its potential impact on economic perception and political outcomes.

A cautionary tale for DPI

As the digital public infrastructure (DPI) agenda continues to advance, placing emphasis solely on the technical attributes of these systems, and Pix continues to be uncritically advertised as a case of success to be replicated, the events that took place in Brazil last month provide important lessons for DPI proponents. As Soujanya Sridharan et al. invite us to reflect, “Rather than focus overly on components of DPI, we must think more critically about its orientation. How and why is an infrastructure placed in the space it occupies?”

The failures around public policy communication in this episode illustrate how those designing and implementing these systems are so far out of reach from the people using them. On the one side, disinformation campaigns explored people’s fears and concerns, and how dependable they are on digital public services: a study from the Federal University of Rio de Janeiro found that, within 1,770 fraudulent posts on Facebook and Instagram, 949 made reference to the brand of Gov.br, the federal government’s platform that enables access to most digital public services. On the other hand, public authorities tried to address these campaigns with rigid official communication and limited outreach, as exemplified by the statements of the Brazilian Federation of Banks and the federal government. The Central Bank of Brazil tried to explore alternative forms of communication, but the video was so out of touch that it ended up having its legitimacy questioned.

The role played by Meta in amplifying harm in these events also demands further reflection. According to a survey conducted by BBC News Brasil, and the information provided by the company regarding paid ads on the topic during that period, at least BRL 18,000 were spent by federal and state deputies, city councilors, former opposition candidates, and the regional headquarters of the Novo party in the Federal District to spread disinformation. Government officials and supporters spent an estimated BRL 21,000 on informational campaigns, though these efforts happened a bit too late and generated less engagement from the public. In the midst of it, Meta informed the Brazilian government that some of its new content moderation rules, like recommending political content to users, had already been in force in the country — though its fact-checking program will continue there.

The Pix disinformation scandal dealt a significant blow to the Brazilian government's public image and popularity. The rapid spread of false narratives, coupled with the government's initially slow and seemingly ineffective response, fueled a perception of incompetence and untrustworthiness. The viral success of right-wing figures like Nikolas Ferreira, who capitalized on the public's anxieties, underscored the government's failure to control the narrative and maintain public confidence in its digital infrastructure. This erosion of trust was evident in the plummeting Pix transaction numbers and the widespread belief in the false tax, demonstrating a tangible decline in public faith in the government's handling of critical digital services. Furthermore, the necessity of the government to revoke the new norm following public outcry amplified the feeling that the government was out of touch and easily swayed by misinformation, negatively impacting its perceived strength and leadership.

The Pix's most recent episode mirrors the dominant narratives around DPI. As DPI advocates continue to measure implementation success solely through adoption metrics, Pix’s 173 million users story obliterates other stories concerning its persistent democratic deficits, usability issues, and ineffective public communication. As these infrastructures do not exist in a vacuum but within a given societal, political, and economic context, those in the DPI ecosystem need to better account for context-specific needs and safeguards to prevent the political and economic exploitation of these systems — as the use of Pix for intrusive marketing campaigns has also shown us — thus hindering what should be “public” about digital public infrastructures.

As the DPI agenda enters a phase of localization of the concept, there is now a need to understand how it is shaped by regional priorities, motivations, governance models, technological choices, outcomes, and the competing narratives that influence the local public debate around them.