CHILE Trends and Developments Contributed by: Alvaro Moraga Fritz and Sebastián Moraga Nazar, Moraga & Cía.
does not constitute deposit-taking as defined under the General Banking Law. Article 40 of the General Banking Law defines the purpose of a bank as a specialised corpo - ration authorised and regulated to “[h]abitually collect or receive money or funds from the public with the purpose of lending, discounting docu - ments, making investments, engaging in finan - cial intermediation, generating returns on these funds, and, in general, carrying out any other operations permitted by law”. Accordingly, the banking industry’s exclusive activity pertains specifically to “collecting funds with the purpose of investment or lending”. Restricting the act of collecting funds exclusively to banks represents an unfounded, biased and overly restrictive interpretation. Such a stance would unjustifiably render common transac - tions illegal – such as advance payments for real estate, school tuition or prepaid coffee cards. What Should Come Next? Traditional banks should ideally view the fintech industry not as a competitor but as an ally. Near - ly 80% of fintech products are designed to serve unbanked individuals and small and medium- sized enterprises (SMEs), addressing gaps that traditional banking often overlooks. The market must have confidence that the CMF will remain steadfast in its mission, unaffected by corporate pressures, and will stay aligned with the objectives of the Fintech Law. This legislation is pivotal for fostering competition, democratis - ing the financial industry, enhancing the com - petitiveness of traditional banks and broaden - ing the CMF’s regulatory scope. Importantly, the Fintech Law ensures that new market entrants
comply with registration, authorisation and con - trol requirements. Since 2023, Chile’s legal framework has formal - ised the coexistence of two critical regulatory pillars: • the General Banking Law, which governs traditional banking institutions; and • the Fintech Law, which promotes competi - tion, financial inclusion and innovation, while safeguarding consumer interests. The legitimate interests of both sectors are inherently subject to the overarching regulatory framework governing the financial industry. This coexistence has been further reinforced by the Fintech Law and other recent regulatory developments, including: • the law authorising non-bank entities to issue and operate prepaid payment instruments (enacted in 2016 and amended in 2023); • the regulation permitting complementary activities for payment card operators (2024); • the law imposing significantly increased pen - alties for economic crimes (2023); • the extension of corporate criminal liability to internal crimes (2024); and • enhanced competition laws and institutional frameworks, which have strengthened over - sight and enforcement in financial markets. By embracing collaboration and regulatory bal - ance, Chile’s financial ecosystem can achieve greater innovation, inclusion and resilience, ensuring long-term benefits for consumers and the broader economy.
107 CHAMBERS.COM
Powered by FlippingBook