|Carlos Fradique-Méndez||Camilo Vásquez|
The financial technology (fintech) industry continues to expand globally and many countries have started to regulate the industry with varying approaches. Some countries aim to stimulate innovation, whereas others take an opposite approach, arguing the case for the safety of consumers, and establishing relevant regulations.
In Colombia, local and international fintech companies have continued to grow without a clear regulatory framework, in some cases, explicitly contradicting local financial regulation. In August 2016, the Colombian financial regulator presented research on regulation alternatives for crowdfunding. It also announced discussion forums for fintech services in areas such as payments and remittances, insurance, digital assets, trading and markets, financial comparison, enterprise and personal financial management, scoring, identity and fraud, online lending and crowdfunding.
In its crowdfunding research, the financial regulator highlighted the conflict between lending and equity crowdfunding and the unauthorised banking regulation and public offer rules in force. Similar conflicts between fintech services and the prevailing local regulation are common and careful structuring of business activities and knowledge of the intricate financial services regulations are crucial when providing these new types of services in the Colombian market.
A sound understanding of the forthcoming fintech regulation and how it relates to the rest of the financial rules is critical for the correct offering and promotion of any such new services. Well addressed, the local regulation may support this innovative industry and enable it to take advantage of the existing infrastructure and develop synergies with the traditional financial companies.
Carlos Fradique Mendez and Camilo Vásquez