CHILE Law and Practice Contributed by: Alberto Alcalde, María Catalina Zegers García-Huidobro and Pía Robledo, Puga Ortiz
Providers must have the capacity to process trans - actions efficiently through robust systems and infra - structure. Interruptions or contingencies in systems must be dis - closed to customers. Entities must disclose potential conflicts of interest. The CMF supervises the activities of entities involved in trade execution, ensuring compliance with legal standards. The CMF can impose corrective measures to protect investors and ensure market integrity. The legal framework also encourages entities to adopt innovative solutions for trade execution while main - taining compliance with regulatory standards. 4. Online Lenders 4.1 Differences in the Business or Regulation of Fiat Currency Loans Provided to Different Entities The Fintech Law provides a general framework for financial services, including credit advisory, which may indirectly address aspects of lending activities. Credit advisory involves evaluating or recommend - ing the creditworthiness of individuals or entities for the purpose of obtaining, modifying or renegotiating loans. Entities providing credit advisory services must meet standards of suitability and technical competence and must disclose conflicts of interest, evaluation criteria and risks associated with their recommendations. However, where fintech entities engage directly in lending activities – including online lending models – the underlying credit operations are also subject to Law No 18.010, which establishes the legal framework governing credit operations and monetary obligations in Chile. This statute regulates, among other matters, maximum conventional interest rates, usury limits and general contractual conditions applicable to credit agreements.
Accordingly, non-bank lenders operating through digital platforms must ensure compliance not only with the Fintech Law and CMF requirements (where applicable), but also with the substantive limitations imposed by Law No 18.010 on interest rates and credit structures. In addition, compliance with financial integrity, data protection and AML measures remains mandatory for all financial service providers involved in lending activities. 4.2 Underwriting Processes The system provides general principles and require - ments for financial services, including credit advisory, which may involve underwriting-related activities. Credit advisory involves evaluating the creditworthi - ness of individuals or entities, including their ability to repay loans. Providers must use objective, coherent and consistent standards in their evaluations. The CMF supervises entities providing financial ser - vices, ensuring compliance with legal standards. While the law does not prescribe specific underwriting methodologies, it requires adherence to principles of transparency, risk management and customer protec - tion. Entities must implement policies, procedures and controls to manage risks inherent to their business lines. Providers must disclose the criteria, methods and risks involved in their evaluations to customers. Underwriting typically involves assessing credit scores, income, debt-to-income ratios and collateral for individuals. For businesses, it may include review - ing financial statements, business plans and market conditions. 4.3 Sources of Funds for Fiat Currency Loans The law does not explicitly outline the sources of fiat currency funds for loans or the legal and regulatory issues associated with each source. However, it pro - vides a framework for financial services, including platforms for crowdfunding and other financial activi - ties, which may involve loan funding.
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