CNBV Pushing Competition in the Financial Sector
Technology’s “disruptive element” will heighten competition in Mexico’s financial sector and help companies offer improved products and services to consumers, President of the National Banking and Securities Commission (CNBV) Juan Pablo Graf has said. "The role of technology in the transformation of the Mexican and global financial system is of utmost importance. In Mexico we have taken very important steps to make technology a disruptive element to ensure the system’s competitiveness and inclusiveness," he explained.
Graf mentioned that the CNBV was moving forward with the approval process of over 80 fintech platforms that have been pending authorization. Though many of these companies are already functioning and have not had their activity stunted by the wait, approvals will increase competition in an already competitive market that was spawned with the passing of Mexico’s Fintech Law in March 2018.
Among the topics to be resolved will be the sharing of consumer data, which fintech stakeholders believe will help increase competition and ultimately provide Mexican consumers with higher-quality, fairer services.
In a recent interview with Mexico Business News, Country Manager of Spanish fintech platform Bnext Cristian Huertas explained that the General Data Protection Regulation (GDPR) that is used in Europe is an example of measures that could be taken in Mexico to even the playing field between consolidated traditional banks and the new fintech companies moving into the market.
“(The GDPR) is very important in Europe and Mexican regulators are now looking at it very closely. With open banking, regulations like this help improve security and create fairer competition with traditional banks. While traditional banks can access customer data at a low cost, digital banks must pay far higher fees. Traditional banks also have far easier access to certain financial channels like convenience stores, such as OXXOs or 7Elevens, which are vital for social inclusion,” he said.
You can read the full interview here.
Graf also noted that the CNBV was working to increase financial inclusion, one of the main objectives of the MORENA federal government. "We know that there are many ideas on how to make financial services more accessible to the entire population … they are part of the Fintech Law and have been developed in other countries, they are very important for the future," said the CNBV president.
Newer fintech platforms and online banking services from traditional commercial banking institutions have become far more popular during the COVID-19 pandemic. BBVA added 400,000 digital clients to its books in 1Q20, while Santander stepped into the fintech market investing in a55.