The state of Open Banking in Latin America


Isabel Head of Marketing


The state of Open Banking in Latin America

Open Banking – the opening of financial markets through technology, data and the creation of new digital products – is advancing extremely fast yet at an uneven pace across countries in Latin America.

On the one hand, we have countries like Mexico that have opted for a regulatory path similar to that of Europe, where the Open Banking initiative is quite advanced but the implementation deadlines are not yet clear. Then, there’s Brazil, which is moving really fast and published in April 2021 new guidelines for the implementation of its second phase of the Open Banking initiative.

And on the other hand, we have countries like Argentina and Peru, still lacking regulations and taking a more “wait and see approach,” analyzing the steps taken by other countries in the region.


Specifically in Mexico, in March 2020, the Comisión Nacional Bancaria y de Valores (CNBV) published the first rules of Open Banking, contemplated in the ‘Ley Fintech’, but although the regulation is quite advanced, there are still many unknowns about the implementation and delays in the set times. The consensus in the market is that it will probably take years before Open Banking (or Open Finance) becomes a reality as stated in the legislation and it is likely that in the meantime the alternatives offered by API platforms will be the default choice by innovators and fintechs.

According to their latest updates, by the 5th of June 2021, over 2,200 financial entities in Mexico should have already implemented APIs to exchange open data with third parties. The next step is to expand this obligation to aggregated and transactional data. It is expected that during 2021, Mexico will publish new provisions related to transactional information from customers’ accounts and credit. However, it is not yet clear what the deadlines for sharing this data will be on a mandatory basis. Likely, companies will have until the end of 2021 to give third-party providers access to accounts, and it will not be until 2022 that the obligation will extend to credit data.

Open Banking in Mexico will force ITFs (financial technology institutions) or fintechs to share their data via APIs. In this way, banks will also be able to use their data which implies a two-way flow. Mexico is the only country in the world that establishes this exchange of information between fintechs and banks.

A high proportion of Latin America’s population still lacks access to banking services; in some countries this figure rises above 50%, according to the World Bank. Bridging this gap is part of Open Banking’s overarching objectives, by fostering financial inclusion and offering better products and services to users, for example via the development of Fintech APIs.

Potential for growth

The good news is that Latin America is one of the most fertile regions for Fintech innovation. With a high number of companies (more than 1200) tackling the existing access problem, experts predict that Fintech companies will be able to occupy up to 30% of the Mexican banking market in the next decade, while the Brazilian Fintech sector will generate potential revenues of $24 billion over the next ten years.

The Fintech industry has the potential to greatly grow the market size of the financial sector in Latin America. This is because in emerging markets, the growth of Fintech -with open banking as a catalyst- allows for greater innovation and the possibility of greater financial inclusion.

At Belvo, the leading Open Banking API platform in Latin America, we have created a report on the current state of Open Banking in Latin America and an analysis of what’s ahead👇

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