The use of users’ transactional data represents a growth opportunity for Mexican fintechs, according to Finerio Connect, and highlights that currently the law for Open Banking or open banking misses areas of opportunity due to pending in the regulatory framework.
“You can only access information on your transactions through your bank. The advantage with open banking is that you can give other companies permission to have that information and thereby access innovative services such as personal finance tools, for example. example; interactive graphs, automated savings, etcetera” commented José Luis López, executive director of Finerio Connect.
He recalled that the model for sharing information in open banking is provided for in the Law to Regulate Financial Technology Institutions, known as the Fintech Law. Although for the moment, the regulation limits the information of the users to be shared exclusively with the institutions of the financial system and with strict adherence to the terms authorized by the client.
The Fintech Law establishes in its article 76 that all financial entities are obliged to share transactional information of their clients, through standardized computer application programming interfaces (APIs, for its acronym in English).
Financial entities that do not implement APIs, in order to share information with authorized entities, could be subject to a fine of 15,000 to 75,000 Units of Measurement and Update (UMA), today equivalent to a fine of 1 million 443, 300 to 7 million 216,500 pesos.
Include non-financial institutions
Encouraging other industries to incorporate APIs, in their operation under a regulatory framework, would bring benefits to the fintech ecosystem, although customers and companies would be the main beneficiaries, since they can work on personalized product or service offers for customers, according to with Finerio Connect,
“The National Banking and Securities Commission (CNBV) only regulates financial institutions, there are companies that are not regulated by the commission and issue non-bank cards, for example department stores, which are not required to share data, but this information remains just as relevant” commented Luis López.
According to the executive director of Finerio Connect, the importance of aggregating information that is outside the financial system lies in the benefits that this data can have for the unbanked population.
“It is important to have data from other industries, for example, with telecommunications information a credit rating could be generated”, this is because in Mexico 50% of adults have a financial product, but 90% have a cell phone, so it is very useful to add to the financial inclusion in credits”, López concluded.