Eternity Law International — News — Fintech in Argentina

Fintech in Argentina

Published:
September 11, 2023

Introduction

Argentina has positioned itself as a prominent hub for fintech evolution in the Latin American (LATAM) region. With a growing number of firms and a thriving technological landscape, the country has outpaced many of its neighbors and even caught up with several European nations. However, amidst economic instability and a challenging legislative environment, understanding the rules surrounding fintech, cryptocurrencies, and payment systems becomes crucial. In this article, we will explore the fintech landscape and crypto regulation in Argentina, diving into the controlling structure, licensing process, and opportunities for innovation.

Regulatory Landscape

Argentina differs from the United States in terms of its approach to Money Transmitter Licenses (MTLs). While the US has a state-by-state licensing system, Argentina has adopted a centralized approach, with the Central Bank of Argentina (BCRA) serving as the sole agency, giving MTLs. As the federal system controlling the national banking and remittance systems, the BCRA plays a pivotal role in shaping the fintech field.

Understanding the Payment System

To comprehend the intricacies of fintech rules, it is essential to grasp the payment system landscape in Argentina. The BCRA established the National Payment System (SNP), which encompasses payment instruments, procedures, and methods facilitating the circulation of money within the country. Funds transfers, a key component of the SNP, allow for both commercial and non-commercial transactions, supporting payment methods and personal sendings.

Types of Licenses

Payment Service Providers (PSPs) operating within the remittance scheme in Argentina have specific roles and corresponding licenses. PSPs can serve as payment account providers, initiators, ATM funds transfer managers, or electronic fund transfer intermediaries. To operate legally, PSPs must register with the BCRA under the Registry of PSPs. Additionally, the BCRA has introduced two specialized licenses for certain roles: the Proveedor de servicios de pagos que ofrece cuentas de pago (PSPCP) license for payment account providers and the PSP que cumplen la función de iniciación (PSI) license for initiators.The MSB license (Money Transmitter License) allows firms to legally supply options related to funds transfers and other payment actions. The MSB license in Argentina is issued by the BCRA and is necessary for fintech firms that engage in money transmission or payment services. 

Registration Requirements for Fintech Companies in Argentina

To register as a Payment Service Provider (PSP) in Argentina and obtain the necessary licenses from the Central Bank of Argentina (BCRA), firms must fulfill certain requirements. The enrollment process involves complying with specific criteria and providing essential data. Here are the registration demands for fintech firms in Argentina:

  • Legal Entity: The company must be a legally recognized entity incorporated in Argentina or a foreign company with a subsidiary registered in the country.
  • User ID: Before initiating the registration process with the BCRA, the company must obtain a User ID from the Argentinian Tax Authority (AFIP). This ID serves as a unique identifier for the company in its interactions with government agencies.
  • Commerce Operations: Companies must supply comprehensive data about their commerce operations. This includes details regarding the nature of the fintech options  they offer, the target market, and the overall commerce model.
  • Bylaws: Firms are required to submit general data about their bylaws, which outlines the internal governance structure and operational framework of the organization.
  • Designated Responsible Employees: The company must designate employees who will act as responsible individuals in their interactions with the BCRA. These employees will be the main point of contact and will handle any communication or compliance-related matters.
  • Monetary Information: Companies may be required to provide monetary statements or demonstrate monetary stability to ensure their capacity to operate as a PSP.
  • Data Safety: Fintech firms must demonstrate conformity with data protection and security standards to safeguard customer data and remittances.

It is important to note that the BCRA may request additional documentation or information during the registration process, depending on the specific circumstances of each firm. The registration demands aim to ensure transparency, stability, and conformity with the administrative framework governing the fintech sector in Argentina.

Once the registration is complete and all demands are met, firms can proceed with the licensing process and apply for the appropriate licenses based on their role within the payment scheme, such as payment account provider or initiator.

Restrictions and Prohibitions

Certain restrictions apply to PSP licenses in Argentina. Currently, only companies incorporated in Argentina or foreign companies with local subsidiaries are eligible to apply. Notably, no foreign firms currently hold PSP licenses in Argentina. Furthermore, PSPs are prohibited from lending user funds, and all funds must be fully deposited in a bank’s sight account. PSPs can only offer accounts denominated in Argentine pesos, and they, along with banks and monetary entities, cannot charge fees for remittances between end users or accounts held by the same individual. As of May 2023, PSPs are also prohibited from offering products or services related to virtual assets or cryptocurrencies. However, some local players have navigated this restriction by separating their crypto and fiat operations into distinct entities.

Innovations

Despite the administrative challenges, the monetary field in Argentina offers immense potential for innovation. By complying with the BCRA’s regulations and licensing demands, firms can establish themselves in a market ripe for disruption. Fintech solutions, particularly in areas such as mobile transfers, remittances, and digital wallets, can address the country’s economic complexities and contribute to monetary inclusion.

Conclusion

As Argentina continues to solidify its position as a leading fintech hub in LATAM, understanding the administrative framework is crucial for fintech firms aiming to operate within the country. By navigating the licensing process, adhering to rules, and capitalizing on opportunities for innovation, fintech ventures can contribute to the growth and development of Argentina’s vibrant fintech ecosystem.

Is cryptocurrency legal in Argentina?

Yes, cryptocurrency is legal in Argentina. The country has adopted a relatively open approach towards cryptocurrencies, allowing their use and trade within the regulative framework.

What is the status of cryptocurrency in Argentina?

Argentina has witnessed a growing interest in cryptocurrencies and blockchain technology. While the government has not explicitly regulated cryptocurrencies as legal tender, they are considered a digital asset. The use of cryptocurrencies, such as Bitcoin, Ethereum, and others, is widely accepted in various sectors, including e-commerce, remittances, and investments.

The Argentine government has taken steps to regulate and monitor cryptocurrency activities to prevent money laundering, terrorist financing, and other illicit activities. In 2019, the Monetary Information Unit (UIF) issued guidelines that require cryptocurrency exchanges and firms to register and report transactions exceeding a certain threshold.

Additionally, Argentina has seen an increase in the number of cryptocurrency-related commerces and startups. Local players have found ways to operate within the regulative  boundaries by separating their crypto and fiat operations into distinct entities.

Overall, while cryptocurrency is legal and widely accepted in Argentina, the regulatory field  continues to evolve as authorities work to establish comprehensive guidelines and frameworks to ensure consumer protection and mitigate risks.

You could be interested

Fintech company registration in Malta and Singapore

Registration of a fintech company in Malta and Singapore is quite a popular request in recent years. This article describes in detail the process of creating fintech companies in Malta and Singapore. Reasons why it is necessary to register a company in Malta In recent years, it has been Malta that has gained a reputation...

PI license in the UK

Several types of non-banking firms whose main professional scope is provision of financial services exist. Operation of such enterprises and all deals performed by them as professional services are monitored by the state and laws of the jurisdiction in which organizations function. To conduct such activities officially, an appropriate permit from the regulator is required....

MSB License in the USA

Introduction Within the intricate framework of the financial services sector in the United States, Money Services Businesses (MSBs) occupy a central role, facilitating a broad spectrum of financial transactions. These enterprises provide a diverse range of services, encompassing currency exchange, money transfer, and payment processing. To operate in compliance with U.S. laws, MSBs must obtain...

Ready-made company in St. Kitts and Nevis

Nestled in the heart of the Caribbean, St. Kitts and Nevis beckon with not only natural beauty but also enticing business prospects. For entrepreneurs and investors seeking to establish a presence in this tropical paradise, the purchase of a ready–made company, often called a “shelf company,” can be a strategic move. In this article, we...

Gambling license in Tobique

Tobique gaming license is a formal permission which allows you to perform multinational operations, except with finite jurisdictions, which make it less administrative and more accessible for the business projects which are onset. Tobique casino license lets digital casinos and platforms guarantee their operations are licit. Such an authorization makes sure that the platform adheres...

ISO 22000: Food Industry Management

In all food industry, it is becoming increasingly important to develop and use such controlling schemes that could demonstrate their ability to administrate risks in food field and could guarantee compliance with different regulations. ISO 22000 gives enterprise a number of internal benefits: basis of ISO 22000 is comprehensive method that covers safety parameters of...

Related posts

Crypto License in Argentina as your investment

Argentina’s evolving cryptocurrency regulatory framework is undergoing profound transformation, presenting discerning investors with exceptional prospects in the realm of digital finance. Amid escalating global demand for robust digital asset oversight, this treatise meticulously examines the intricate benefits, legal stratagems, and emerging opportunities that accompany the acquisition of a crypto license in the country. By elucidating...

Argentina Authorised Crypto Companies

Cryptocurrency is rapidly transforming the global financial landscape, and Argentina has emerged as a key player in this sphere. The nation’s evolving approach to digital currencies makes it a prime destination for entrepreneurs aiming to establish authorised crypto companies in Argentina. With growing global interest in decentralized finance and blockchain technology, Argentina stands out as...

VASP License in Argentina

This type of licence is increasingly relevant as this region becomes a hub for e-currency operations. To obtain VASP licence in Argentina is essential for operating legally within Argentina’s growing crypto market, offering multiple benefits from regulatory support to potential tax incentives. Advantages of VASP Licence Demands for receiving this type of licence The submission...

VASP Regulation in Argentina 2024

With the development of cryptocurrency technologies and their growing popularity around the world, the issue of regulation of crypto assets is becoming increasingly relevant. Argentina, one of the Latin American countries with an active crypto-currency market, has taken significant steps in recent years to create a regulatory framework for virtual assets and related services. In...

PSP license in Argentina

Advanced innovation has had a huge effect on how electronic payments work in Argentina. The main reason for this big change is because of the Payment Service Providers (PSPs). They are very important in how money is exchanged in the country. In order to thrive and achieve success in this evolving landscape, acquiring a PSP...

Company registration in Argentina

Argentina still has not been able to fully overcome the economic crisis that has been going on over the past decade. The state must still make a lot of efforts to revive the economy. Therefore, the country’s government is trying its best to attract foreign investors. In recent years, experts say, Argentina has been moving...

Discover our services

The international company Eternity Law International provides professional services in the field of international consulting, auditing services, legal and tax services.

Ready-made companies for sale

Companies with a bank account around the world

Banks for sale

Established Banks for sale

Ready-made licenses for sale

Forex, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Licensing

Forex licenses, cryptocurrencies, gambling, EMI, PSP, SVF, MSO, DLT

Offshore company registration

Expert advice on the acquisition of an offshore company

Open a bank account

Open bank accounts in more than 120 banks around the world
Fill the blank: