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Importance of fintech law modification for large technology companies

The law to regulate Financial Technology Institutions would seek to modify, in the first place, companies such as Amazon, Google and Facebook so that they do not carry out monopolistic practices that affect the market.

Before the emergence of ‘Big Tech’ – a group made up of Google, Amazon and Facebook in the world’s financial markets, and more than a year after the approval of the Law to Regulate Financial Technology Institutions (Fintech Law), complement regulation for large technology companies and prevent the creation of monopolies in Mexico, said Rafael De la Parra, CEO of Enso.

Just like the banking institutions, Enso is committed to sending and receiving money, through an application via cell phone and without charging commissions, with what they hope to close the market with 250 thousand users, for this year. De la Parra pointed out, moreover, that many industries in Mexico have this nature of dominance, especially when the origin of the regulation does not contemplate putting solid rules to prevent these practices. In the same line, explained that the application will allow a better budget and better control of expenses, send and receive money with only the recipient’s mobile number and provide financial advice through their social networks.

The CEO of Enso said, in addition, that the lack of regulation could create entry barriers for more companies and would not generate competitive conditions, where innovation and prices should be optimal for the consumer. For example, taking the case of Google, he has for a long time a banking license in the Netherlands, with which he could exercise financial services throughout Europe, such as loans made in the United States to small and medium enterprises. In the case of Facebook, it connects people, family and friends in an easy and virtual way. The inclusion of the application could facilitate monetary loans between family and friends, which in turn would reinforce the trust in the platform to carry out the procedures mentioned above.

Currently, Enso operates as a Financial Institution of Electronic Payments (IFPE). However, Enso will request to be a future Popular Financial Company (Sofipo). If converted, Sofipo would be a microfinance entity constituted as an Association of Banking and Securities Capital (CNBV). With this, Enso seeks that the application (which has a highly social element) can have a greater reach, because that way, they could provide the service to those users who access the technology without having a bank account or credit or debit cards. .

Published inFintech
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