Here is the converted article in markdown format:

Fintech Regulation in Honduras: A Review

As part of its ongoing efforts to promote innovation and financial inclusion, the Honduran regulator has been actively considering the impact of new fintech practices on existing regulations.

Anti-Money Laundering (AML) and Sanctions Rules

While there are no specific reporting obligations for AML purposes in the current fintech regulation, the Money Laundering Prevention Law establishes certain requirements. Here are some key points:

• Regulated entities must provide information to AML authorities under certain conditions when specific types of transactions occur.
• The reports and information handled by these authorities are kept confidential, except in cases where an investigation is opened.
• Fintechs related to electronic money issuance and money retention must apply for registration with the National Banking and Insurance Commission’s registry for non-financial businesses and professions (DNFBPs) that are at risk of money laundering or terrorist financing.

Robo-Advisers

As of February 2024, there are no fintech players offering robo-adviser services in Honduras. However, the authors understand “robo-adviser” to be a digital platform that provides automated financial planning services, which would need to comply with the Securities Market Law.

Online Lenders

Honduran regulations do not require specific underwriting processes for online lenders. The main sources of funds for loans from supervised financial institutions come from:

• Deposits
• Lender-raised capital

Non-financial institutions obtain funding from their own capital and lender-raised capital.

Payment Processors

Payment processors in Honduras must use existing payment rails, but may create or implement new payment rails prior to authorization by the Honduran Central Bank (BCH).

Fund Administrators

Fund administrators are regulated depending on their activities by the Securities Market Law. They must be authorized by the National Banking and Insurance Commission and comply with specific provisions for incorporation.

Marketplaces, Exchanges and Trading Platforms

Online marketplaces are permitted in Honduras, as long as they refer to general goods and services, not securities or currencies. Cryptocurrency exchanges are currently unregulated, but could be understood as a securities exchange if they comply with the criteria set forth by the Securities Market Law.

• The Central American Stock Exchange is the only authorized exchange marketplace for public offerings of securities.
• The BCH also carries out currency auctions and government bond auctions.

Overall, Honduras has taken steps to promote fintech innovation while maintaining regulatory oversight. As the industry continues to evolve, it will be important for regulators and fintech companies to work together to ensure compliance with existing regulations and promote financial inclusion in the country.