Compliance Challenges for Fintech Companies in Chile

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The fintech market has experienced rapid growth in Chile, with over 400 companies operating in the country since 2019. This surge can be attributed to the government’s efforts to reform its laws and regulations, creating a favorable environment for digital finance.

New Regulations for Compliance

In 2024, the Financial Markets Commission issued new regulations aimed at ensuring compliance among fintech companies. The Fintech Law sets out seven regulated activities, including:

Investment advising
Credit scoring
Crowdfunding
And more

Companies must comply with the following requirements:

Disclosure Requirements

Disclosure requirements vary depending on the activity, but the main goal is to inform consumers of:

Investment risks
Conflicts of interest
Service characteristics
And more

Corporate Governance

Corporate governance plays a crucial role in compliance, with companies required to:

Establish risk assessment and internal auditing roles
Create risk appetite and management manuals
Implement internal policies

Capital and Guarantee Requirements

Capital and guarantee requirements are also strict, with three blocks of proportional regulation based on company size and activity. Companies must demonstrate operational capacity by:

Stress-testing systems
Establishing procedures to monitor operational risks

Timeline for Compliance

The regulation came into effect on February 3, 2024, and companies have a one-year window to ensure compliance. Non-compliance can result in:

Fines of up to UF 1,000 (approximately USD 45,000)
The impossibility of providing regulated services

Conclusion

With these new regulations in place, it is essential for fintech companies to begin working towards compliance immediately to avoid penalties.