Financial Crime World

Fintech Regulatory Framework in Honduras: An Overview

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Development of Fintech Regulation in Honduras

The fintech regulatory framework in Honduras has made significant progress in recent years. Here are key points from the report:

Anti-Money Laundering (AML) and Sanctions Rules

  • Lawful Requirements: The Money Laundering Prevention Law requires financial institutions to supply information and reports to AML authorities under certain conditions.
  • Registry of Designated Non-Financial Businesses and Professions (DNFBPs): There is a registry managed by the National Banking and Insurance Commission that includes non-financial institutions at risk of money laundering or terrorist financing.

Robo-Advisers

  • Current Status: As of February 2024, there are no fintech players offering robo-adviser services in Honduras.
  • Existing Fintech Services: Payment facilitators, payment gateways, Bitcoin ATMs, digital banking, electronic wallets, payment networks, cryptocurrencies, and alternative lending.

Online Lenders

  • Regulatory Differences: Loans issued by traditional supervised financial institutions operate under a different framework than lenders that do not perform financial intermediation (non-banking lenders).
  • Compliance Requirements:
    • Supervised financial institutions must comply with prudential regulations as well as consumer protection regulations.
    • Non-banking lenders only have to comply with consumer protection regulations.

Payment Processors

  • Regulation: Payment processors must use existing payment rails and may create or implement new payment rails prior to the authorization of the Honduran Central Bank (BCH).
  • Currency Negotiation: The regulation regarding currency negotiation contains specific provisions about currency management for remittances, including a security tax applicable to foreign transfers.

Fund Administrators

  • Regulation Depending on Activities: Fund administrators are regulated depending on their activities by the Securities Market Law.
  • Provisions for Incorporation: There are provisions for the incorporation of fund administrators, specifically and only when they undertake activities in the stock market.

Marketplaces, Exchanges, and Trading Platforms

  • Permitted Online Marketplaces: Online marketplaces are permitted as long as they refer to general goods and services, not securities or currencies.
  • Authorized Exchange Marketplace: The Central American Stock Exchange is the only exchange marketplace authorized for public offerings of securities.

Conclusion

These points provide an overview of the current fintech regulatory framework in Honduras. However, it’s worth noting that this framework is still developing and subject to change.