The president of Mexico, Enrique Peña Nieto, signed on Thursday the enactment of the Law for Financial Technology Institutions , known as the Fintech Law, in the framework of the inaugural session of the 81th Banking Convention, promoted by the Association of Banks of Mexico (ABM) Coinciding with the enactment, the ABM and other financial institutions requested that the Bank of Mexico define the conditions for the use of cryptocurrencies in secondary legislation, which regulates the execution of the law.

The purpose of the Fintech Law , approved on March 1 by the Chamber of Deputies of Mexico, is to regulate the services provided by the Financial Technology Institutions (ITF), including their organization and operation. Within these services are those of collective financing, management of electronic payment funds and the commercialization of cryptocurrencies , defined by the law under the figure of virtual assets.

The use of cryptocurrencies in the payment area reflects one of its main advantages over the conventional banking system, since transactions are made directly between users, quickly, safely and with lower commissions. That is why the law is perceived as a facilitator of greater competitiveness in the financial sector , considering new types of securities that are not covered by traditional financial institutions.

Marcos Martinez, president of the ABM, told the newspaper El Financiero said the criptomonedas deal with another form of trade. “It has to do with less intervention, specifically from central banks. For that they were created and as a trend you can not avoid what future realities are, “Martinez said.

However, the executive said that does not mean that the sector does not worry about the use of cryptocurrencies and the relationship that may have with money laundering . 

We have the same concern of the authorities and it is shared. In the approved FinTech law, it will be the Central Bank who will decide which cryptocurrency is legal and under what conditions.

Marcos Martínez

President, Association of Banks of Mexico

  • For his part, the CEO of HSBC Mexico, Nuno Matos, said that the use of cryptocurrencies is still not well understood by the bank, so they will not work with them anywhere in the world where the bank operates. 
  • We have something very clear, at HSBC we do not sell or buy cryptocurrencies from our clients, and we do not process payments finished in cryptocurrencies. This is for several reasons. The first is that we only sell to our clients what we understand, if there is something we do not understand, we will not do it because as a financial institution we have the duty to protect the savings and investments of our clients.

Nuno Matos

General Director, HSBC Mexico.

  • Ernesto Torres, general director of the Citibanamex Financial Group, expressed reservations about what he believes is “the anonymity of transactions with cryptocurrencies.”
  • It is the first time that reactions of caution and suspicion of notable executives of the Mexican banking sector arise against the recently approved Fintech Law, and just coinciding with the proclamation of this important legal instrument, of foreseeable impact both in Mexico and in the Latin American region.

Author: Yash Hirani

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