Regulatory Flexibility, AI Integration Drive Financial Growth

BGBG is a highly specialized law and regulatory compliance firm with about 25 years of experience in the Mexican market. We have 17 partners and a team of close to 120 professionals. Our headquarters are in Mexico City, with additional offices in Querétaro, Merida, and a representative office in Madrid, Spain.

Q: What is Bello, Gallardo, Bonequi y García’s (BGBG) value proposition and areas of specialization?

A: BGBG is a highly specialized law and regulatory compliance firm with about 25 years of experience in the Mexican market. We have 18 partners and a team of close to 180 professionals. Our headquarters are in Mexico City, with additional offices in Monterrey, Merida, and a representative office in Madrid, Spain.

We are a full-service law firm. We originally began as a boutique firm with deep specialization in sectors such as telecommunications, media, technology, financial and banking law, regulatory compliance, privacy and data protection, and mergers and acquisitions. Over time, we expanded our capabilities and today provide comprehensive legal services across all practice areas to both domestic and international clients, while maintaining strong positioning in our core specialties.

Q: Since the pandemic, what significant changes have you observed in the financial sector and in what clients are requesting from the firm?

A: In the financial, banking, and regulatory compliance sectors, we have seen a profound evolution following the pandemic. The industry has transitioned from a product-centered model to a much more integrated and complex platform- and ecosystem-based model.

There has been a clear digitalization of the entire client lifecycle. Data usage for credit origination and risk management has intensified significantly. At the same time, there is increased emphasis on operational and technological risk, including reliance on third-party providers, cloud services, cybersecurity, data protection, and regulatory compliance. What clients are demanding today is far more technical, data-driven, and risk-based. Compliance is no longer a static exercise; it is dynamic, embedded in operations, and closely linked to risk management methodologies.

Q: Has the industry fully transitioned into this new era, or is it still in a transformation phase?

A: We are still in a transition phase. There is significant progress, but there remains substantial opportunity for further development. We have seen increased institutional sophistication among clients. They are investing more in corporate governance, strengthening internal risk management frameworks, and professionalizing compliance functions. However, there are important asymmetries in the market.

Some participants — typically large or well-capitalized institutions — are far more advanced in governance and compliance structures. Others, particularly smaller or emerging players, are still catching up. These differences are also visible depending on the type of license involved. Advising a bank, brokerage house, or insurance company is quite different from advising a fintech institution. Each operates under distinct regulatory expectations and maturity levels.

Q: How does Mexico's regulatory framework compare with that of other countries? 

A: From a practical perspective, Mexico has a significant opportunity to continue improving its regulatory processes and strengthening its authorities. There is room for modernization, particularly in updating existing regulations such as the Fintech Law and other related financial frameworks.

Regulatory efforts are heavily focused on crime prevention and risk mitigation. While that is certainly important, it represents only one dimension of a broader model. Mexico should move toward a regulatory approach that is more product-oriented, one that not only focuses on what needs to be controlled, but also on what the country wants to promote. This means designing more agile regulatory processes around issues such as onboarding, payments, data management, and operations. Instead of concentrating primarily on ex-ante restrictions, regulators could rely more on ex-post controls as a second strategic layer. That would allow innovation to develop while maintaining oversight mechanisms to mitigate risk as models evolve.

Mexico should promote greater flexibility, deeper communication between regulators and industry, and a framework that encourages product development and gradual scaling rather than imposing full regulatory burdens from the outset.

Q: How should Mexico balance innovation with consumer protection?

A: A country can choose a highly conservative and protectionist approach, arguing that because one fintech failed, no further innovation should be permitted. However, that approach inevitably slows economic growth and development. In other countries, such as the United States and Spain, the collapse of financial or crypto-related companies has not led to the complete shutdown of innovation. Instead, these jurisdictions continue promoting innovation while strengthening oversight mechanisms.

The existence of risk does not justify discouraging the evolution of business models. Regulation must be modeled according to the realities of each sector and each type of participant. Ideally, innovation should take place domestically under a controlled, scalable framework. This ensures that capital, talent, and economic value remain in Mexico. Otherwise, innovative players either leave the country to develop their models abroad or enter Mexico only after consolidating elsewhere.

Q: How has risk management evolved in recent years in the transition of the financial ecosystem?

A: Risk management has evolved significantly. Compliance is no longer a formalistic, paper-based exercise. Previously, procedures were often implemented primarily to demonstrate regulatory adherence. Compliance and risk analysis are now expected to be practical, measurable, and effective.

Clients are increasingly focused on developing auditable evidence, traceable data, automated controls, effective corporate governance structures, and robust third-party risk management frameworks. The emphasis is on reducing execution risk and strengthening institutional credibility.

Strong risk management enhances investor confidence, improves access to capital, and positively impacts company valuations. It is a more complex process, but it provides greater security and long-term sustainability.

Q: Mexico’s Fintech Law was groundbreaking at the time, but is now often described as outdated. What is needed for regulatory modernization?

A: It is important to recognize that this phenomenon is not unique to Mexico. Financial and technological innovation evolves faster than regulation in most jurisdictions. The Fintech Law was innovative when enacted, but the market has evolved considerably since then, particularly in areas such as crypto assets, tokenization, and digital asset structuring. While the law provides a regulatory foundation, it does not fully reflect market realities.

In practice, regulatory gaps are being addressed through enhanced compliance measures and by applying existing frameworks — such as anti-money laundering regulations — to new business models. However, there are clear areas for improvement. Regulatory modernization should focus on clarity, proportionality, and alignment with evolving technologies. Continuous dialogue between regulators and industry participants is essential.

Q: What is BGBG’s outlook for Mexico’s financial sector?

A: Mexico has a strong opportunity to position itself as a regional leader, particularly due to nearshoring dynamics and its proximity to the United States and Canada. However, this growth depends on continued regulatory certainty, institutional capacity, effective supervision, and collaboration between public authorities and private sector participants. Topics such as open finance, open banking, financial integrity, and judicial certainty will be fundamental.

If Mexico strengthens these areas, its potential could be extraordinary. The opportunity to become a regional benchmark is real.

Q: What are the firm’s priorities for this year?

A: We aim to continue consolidating our leadership in regulatory compliance and financial law. This year, BGBG was recognized by international publications such as The Legal 500 and Chambers and Partners as a leading firm in Mexico in regulatory compliance for financial institutions and vulnerable activities, as well as in telecommunications and technology.

We are also investing heavily in technology, data protection, and AI. We collaborate with organizations such as OpenAI and Microsoft to ensure the responsible implementation of AI tools.

Our goal is to enhance efficiency, protect our clients’ data, and deliver greater value. Technological sophistication in legal services not only improves quality but also generates cost efficiencies for clients. A more efficient and technologically advanced legal practice ultimately creates measurable value.