Fintechs: new technologies for the financial system require fast and effective regulations

29 . May . 2019 |

By Daniella Tavares, partner of the Corporate, Mergers and Acquisitions practice of Lobo de Rizzo

Technological evolution transforms the world we have known for years, but it keeps on amazing us by the speed that changes are taking place. In the financial market, specifically, we have seen traditions open space for the new with the creation of fully technology-based companies: the so-called fintechs.

A World Bank survey published in 2018 indicates that 69% of the adult population already uses banking services. In Brazil, this percentage reaches 70%. Among those who don’t , a share of 85% has access to mobile telephony, which is a facilitator of financial inclusion policies. Therefore, today, imagining a financial system rich in offers and capable of including the population that does not have bank accounts or access to basic services has become feasible.

Last week I had the opportunity to attend the 2019 Fintech Conference, which took place in São Paulo, and I closely checked what fintechs are doing to solve some chronic problems of customers, banks, insurance and other companies in the financial system. And this digital transformation has been responsible for a complete revolution in the Brazil’s regulatory environment.

The Central Bank of Brazil sees this movement as positive and has advanced in the discussions and regulations of fintechs. But when comparing the speed of this process with the speed in which these companies present new solutions, we notice there is a huge gap. And regulating this environment should not only preserve the rights of users, but also create incentives for technological innovation, respecting the accelerated pace of entrepreneurship and making Brazil competitive in the market, in line with what we see in the rest of the world.

We are on the right track, our institutions are solid, but the perception that we can be more attractive to investments in financial technology, especially those from the foreign market, remains. We have noticed this in the various operations we conduct or consultations our office has received over the past two years.

Today, there are more than 500 fintechs operating in Brazil, according to the Brazilian Association of Fintechs (ABFintechs). Their solutions, as well as the speed of adaptation they impose on us, will require a great deal of legal advisors, who need not only understand the complex legal framework, but also be prepared to contribute at a high level to the developing pace of the sector. I am sure that here at Lobo de Rizzo, we are able to act as protagonists of this revolution.


see all publications