Regulatory Approaches to Mobile Financial Services in Latin America

This report draws lessons from the shared experiences of 12 Latin American countries. It explores what has been done in each country to develop and advance mobile financial services (MFS), and also examines the diverse approaches required by the unique socioeconomic contexts in which regulators and policymakers operate. Key outcomes include:

• Development of MFS regulation has generated discussions on how to define the financial activities supervised by the state, and the relations and differences with MFS;
• Difference in approaches comes from determining who is allowed to develop MFS products and services. In Colombia, Guatemala, and Mexico, only financial system entities, especially the banks, can develop these services, but there is no possibility that non-banking entities would be considered to develop MFS;
• Institutions made changes to their regulatory frameworks to provide MFS. The changes were made based on the reality of their financial markets and the considerations and potential issues that emerged from in-depth discussions on products, channels, risks and, legal authorizations;
• Necessity arose to develop a definition for a new financial transaction in several countries. This was also done to amend the structure of the financial system to allow specialized electronic money issuers to enter the market.