Advances and challenges of the current state of Open Finance in LATAM

Open Finance adoption in Latin America is advancing at an accelerated pace. This innovative trend not only redefines how fintechs and traditional banks connect with their customers but also opens doors for millions of people the traditional financial system has left behind. However, the reality of Open Finance in the region is not uniform; each country is charting its own path, with unique challenges and advances that reflect its economic and regulatory context.

In this article, we will explore the current state of Open Finance in the main LATAM countries, breaking down the progress, challenges, and outlook for Brazil, Mexico, Colombia, Chile, Argentina, and Peru, basing the research primarily on “Banca Abierta en Latinoamérica” (Open Banking in Latin America), a study conducted by Mastercard together with the American consulting firm Gartner.

Brazil, pioneer in Open Finance

Brazil has taken the lead in Open Finance with a phased approach since 2021, led by the Central Bank, which has enabled the participation of more than 800 institutions. This model has facilitated the exchange of financial data and the integration of personalized services, driving financial inclusion. A flagship example is Nubank, which has leveraged the regulation to offer products tailored to the needs of its more than 40 million customers, establishing itself as a benchmark in the region and expanding its presence into other Latin American countries. In Brazil, the success of Open Finance is also reflected in the increased use of APIs for data sharing, which grew 50.4% between January and March 2024.

Mexico, innovation with regulatory challenges

Mexico, a pioneer in LATAM with the integration of Open Finance into its 2018 Fintech Law, has seen slow development due to regulatory challenges, such as the lack of specific rules and API standardization. Despite this, Finvero has emerged as a key player in financial innovation, offering a platform that manages loans in a comprehensive, personalized way across the entire sales cycle. For its part, BBVA México has led banking digital transformation, integrating APIs to improve the customer experience. Although the market shows great potential, Mexico needs to overcome regulatory barriers to fully unlock the opportunities that Open Finance can offer.

Colombia, advances in stages focusing on the consumer

Colombia has begun its journey toward Open Finance with a gradual approach, starting in 2022 with the implementation of payment initiation services (PIS) and plans to introduce account information services (AIS) in 2025 and financial portability in 2026. Although the country has payment schemes such as Botón PSE and Transfiya, it still faces challenges in interoperability and real-time payment adoption. Davivienda has been a key player in this progress, implementing an open innovation strategy that includes collaborating with fintechs and developing the DaviPlata platform. This platform has attracted more than 10 million users, significantly improving financial inclusion in Colombia by offering accessible and convenient banking services through mobile devices.

Chile and its high level of banking

Chile, with high banking penetration (89%) and smartphone adoption, has shown moderate adoption of Open Finance, driven by its 2023 fintech law, and today has 300 companies in the sector. However, the lack of API standardization and limited adoption of real-time payments have held back its development. Bci, a leading bank in digital transformation, has implemented a robust digital platform and integrated third-party APIs to offer personalized services. This has resulted in significant growth in its digital customer base, positioning Bci as a benchmark for financial innovation in Chile.

Argentina faces economic challenges

Argentina has made progress in financial digitalization with initiatives such as Transferencias 3.0 and interoperable QR codes, focusing on real-time payments. However, the lack of formal Open Finance regulation and economic volatility, along with the growing use of cryptocurrencies, have limited the full development of open banking. Banco Galicia has led the way in Open Finance adoption, implementing a solid digital platform and API integration, which has improved customer satisfaction and consolidated its position as an innovator in the Argentine financial sector.

Peru, innovation in payments without formal regulation

Despite the lack of formal Open Finance regulation in Peru, the country has shown notable leadership in cashless payment innovation, with a focus on mobile payments and contactless technology. Although the regulatory framework has yet to be finalized, Interbank has stood out in implementing digital solutions, integrating APIs and platforms that improve the user experience. This progress positions Peru as an evolving market, ready to adopt Open Finance as regulation advances and new opportunities emerge in the financial ecosystem.

Transformation of Open Finance in LATAM

Cómo lo hemos visto, en América Latina, el Open Finance está avanzando a diferentes velocidades, influenciado por regulaciones y contextos tecnológicos únicos. A pesar de los desafíos en seguridad y privacidad de datos, el éxito en la implementación de Open Finance dependerá de la capacidad de las instituciones financieras para construir confianza, proteger datos y ofrecer transparencia. Superar estos obstáculos no solo impulsará el desarrollo regional, sino que también podría ofrecer valiosas lecciones para el resto del mundo. ¿Qué te ha parecido este breve resumen? Juntos sigamos innovando para impulsar la inclusión financiera. No te pierdas nuestras próximas publicaciones para estar al día con los temas más relevantes del ecosistema financiero con Finvero, la plataforma que ofrece solutions for credit management, cubriendo el ciclo de vida del crédito, desde la solicitud hasta la cobranza.

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