This regulation represents a milestone for the Chilean financial market and a central stage in the implementation process of the Fintec Law.
On July 3, 2024, the Financial Market Commission (CMF) published the regulations governing the Open Finance System (SFA) of the Fintec Law (No. 21,521), which will enter into force 24 months after its publication.
This ordinance is another milestone in the implementation process of the Fintec Law, published in January 2023, and is an outstanding advance in the development of the Chilean financial market, placing our country at the forefront in this matter, as mentioned by the CMF in the same note.
The SFA allows users of the financial system to share their data securely in order to obtain greater benefits and better conditions when using these financial services.
It is expected that this regulation will allow the benefits of the Fintec Law to materialize, such as greater competition and financial inclusion and the entry of new financial service providers into the market.
For more information on these benefits and this Law you can read the comparative guide on Fintech, which Compliance Latam produced in December 2023.
In order to meet these objectives, Title III of the Fintec Law provides that the institutions currently regulated in the financial system, defined in the law as Information Provider Institutions (IPI) and Account Provider Institutions (IPC), must compulsorily join the SFA to provide the information that the user decides to share with other participating institutions, with their prior consent.
This will also include institutions that voluntarily decide to register in the SFA to offer financial services to users, being mainly two: Information Based Service Providers (IBSP) and Payment Initiation Service Providers (PISP).
Thus, Title III regulates the SFA and establishes the matters to be regulated by the CMF, which are as follows:
- Section I: Perimeter of the Open Financial System.
- Section II: Operation of the System.
- Section III: Security and Safeguards of the System
- Section IV: System Information.
- Section V: Other Provisions.
The implementation will be gradual, depending on the role of each participant within it.
The first stage will have a period of 24 months prior to its entry into force. This will be used for the adaptations required for the implementation by each of the SFA participants.
During this same period, the CMF will provide Directory services for the operation of the System and will develop the technical manuals with the specifications for the operation of the SFA.
Once the first stage has been completed, the second stage has to do with a schedule for the implementation of the standard. This part is related to the progressive delivery of information to be shared by banks and payment card issuers during the first 18 months of the law’s entry into force.
And following these 18 months, there is a period of time for the same duration, where the obligation begins for savings and credit cooperatives supervised by the CMF, insurance companies, fund managers and compensation funds, among others.
SFA Implementation Schedule
In conclusion, the SFA regulation seeks to modernize the Chilean financial market, fostering innovation, competition and access to more personalized financial services, with continuous supervision and regulation by the CMF to evaluate both benefits and costs on a regular basis.
In this way, the SFA’s rule is added to the one already issued by the CMF on January 12, which regulates the registration, authorization and obligations that Fintec Financial Services Providers must comply with. [More information]
To discuss these issues please contact our Corporate and Business team:
Álvaro Rosenblut | Partner | arosenblut@az.cl
Vicente Martínez | Senior Associate | vmartinezw@az.cl
Javiera Lira | Senior Associate | jlira@az.cl
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