Fintech thrives in CentAm but legislative support is needed


With a proof of concept blockchain transfer between the United States and a recipient in the Dominican Republic, the opportunity to build resilient banking systems is one that some Central American countries are looking to seize.

El Salvador recently saw the launch of its first fintech product, Teip, and the Venmo, Strike, powered by Lightning Network, is now available. However, not all countries have been so enthusiastic and legislation is lacking.


There are no specific regulations for FinTech companies in Guatemala. Hopes for digital legislation are rising with Enrique Cossich, Commissioner for Open and E-Government, appearing on local television to call for digital government.

However, with Congress focused on a battle for the constitutional court, the passing of laws was shelved.

The banking regulator SIB has created an innovation hub to connect with the local fintech community. However, the central bank ruled in 2017 that Bitcoin was not legal tender and had not changed its position.

El Salvador

According to Erick Chacón, president of the Salvadoran association of fintech companies (Asafintech), there are around 35 such entities in the country. However, there is a lack of specialized incubators and accelerators, which makes growth chaotic.

“Mastercard and AWS have joined Asafintech as allied companies supporting businesses. We anticipate Microsoft’s arrival in the next few days, ”Chacón told BNamericas.

Representatives of the Salvadorian Legislature’s Economic Committee issued favorable opinions on the creation of a national digital authority. This would seek to centralize personal data protection, electronic commerce, electronic signatures and cybersecurity issues.

There are regulations on technology and e-commerce, but the digital agenda 2020-30 is a roadmap for future legislation, as data protection and payment systems are not yet finalized and there is no has no laws on crypto assets.

“With the support of the IDB and the World Bank, the regulator is developing fintech regulations, which mainly cover crowdfunding and mobile payments. They are about to share their first draft for industry comment, ”Chacón said.


In January, a USAID report titled Regulatory Barriers in the Techno-Finance Industry in Honduras was released.

“Various dimensions have been identified such as: legal vacuum, regulatory uncertainty, governance issues, among others,” José Rolando Vega, head of regulation, research and development at CNBS, told BNamericas.

The central bank’s fintech company card identified 24 in January.


Nicaragua has developed legislation through the central bank. The fintech regulations were published last September.

It remains to be seen how legislation passed in February that allows people on U.S. government sanctions lists to continue using banking services affects the fintech market.

Costa Rica

In March, the Brazilian company EBANX started its activities in Costa Rica with the intention of establishing itself in El Salvador, Panama, Guatemala and the Dominican Republic.

Specifically, EBANX highlighted huge opportunities in online shopping and digital payments. The company estimates that moving to Central America could represent US $ 12 billion in future e-commerce sales. The Internet penetration rate in Costa Rica is over 80%, with room for improvement.


Another startup, Muscle Points, wants to use artificial intelligence on customer loyalty cards with applications in the retail and banking sectors.

Although there is no specific law covering fintechs, there is legislation on data protection, the drug trade, and the regulation of non-bank financial companies.


Panama borrowed US $ 350 million from the Latin American development bank CAF to finance a massive ICT expansion program.

Part of this is due to Panama’s reputation as a financial center. Critics suggest this has been lost in recent years, but an October 2020 proposal is the basis for fintech regulation.

The Electronic Payment System Law will be used by the banking regulator with a secondary proposal to cover virtual currency and cryptocurrencies.

Dominican Republic

The announcement that IDB Labs and Citibank have made a transfer from the United States to a recipient in the Dominican Republic will surely give the fintech community in the Caribbean country a boost.

As a proof of concept, this could allow faster transfers in the future and opportunities for safer distribution to projects through aid programs or multilaterals.

According to the Association of Commercial Banks (ABA), there were more than 820,000 mobile transactions involving 799 million Dominican pesos (US $ 14 million) in February, an increase of 16.6% in value of year after year.

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