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The Fintech Industry in Brazil: a Promising Future in the Face of Regulation

Brazil’s fintech industry, among Latin America’s top markets, has thrived due to a robust regulatory framework and market potential. Key regulations, such as Resolution No. 4,656 and Joint Resolution No. 1, have modernized fintech operations. PIX, an instant payment platform, has also driven growth. Despite challenges like economic instability, fintech companies have increased financial inclusion and digital access.



fintech industry

The fintech industry has experienced significant growth in Brazil, positioning itself, according to IMF statistics , as one of the main markets in Latin America, along with Mexico. This rise is due to the potential of the Brazilian market, as well as an advanced regulatory framework that has fostered its development.

According to Bruno Soares, office managing partner of the firm’s brand new Sao Paulo office of DLA Piper – a practice that promotes the representation of cases of Latin companies in the United States and vice versa – Brazil has a solid regulatory framework that covers various areas, from digital loans to cryptocurrencies, working together with the Central Bank, Congress and other market players.

This regulatory framework, designed to reduce costs, encourage competition and expand financial inclusion, has been fundamental to the growth of the fintech industry

Among the most relevant regulations that have contributed to this development are Resolution No. 4,656 , issued in April 2018, which modernized the legal framework by regulating peer-to-peer credit and lending transactions carried out by fintechs. Likewise, Joint Resolution No. 1 , established in May 2020, defined the terms and conditions for the Open Finance environment , promoting access to information and transparency in the market.

“One of the main objectives of Open Finance is to promote access to information and improve transparency between market players and their clients,” explained the lawyer.

Furthermore, the introduction of PIX , in August 2020, has revolutionized the payments landscape in Brazil, with more than 145 million people registered in the system and a record of 200 million reais transferred (equivalent to USD 39,114,460) in a single day in April 2024.

“PIX is an instant payments platform created and managed by the Central Bank of Brazil, which allows the rapid execution of payments and transfers,” highlights Soares.

Fintech industry challenges

However, the fintech industry in Brazil faces challenges such as economic and political instability, as well as the lack of technological infrastructure. In this regard, the specialist points out that “these difficulties can present unique opportunities for fintech, such as flexibility in credit analysis and the granting of loans in a context of high interest rates and inflation.”

The impact of the fintech industry in Brazil has been transformative, with a notable increase in digital access to financial services and greater financial inclusion in traditionally excluded segments of the population.

In 2021, actors in the financial ecosystem reported a 66% increase in the number of digital bank account openings, which marked the best pace of development in decades.


(Featured image by ASSY via Pixabay)

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First published in LexLatin. A third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.

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Valerie Harrison is a mom of two who likes reporting about the world of finance. She learned about the value of investing at a young age upon taking over her family's textile business when she was just a teenager. Valerie's passion for writing can be traced back to working with an editorial team at her corporate job, where she spent significant time working on market analysis and stock market predictions. Her portfolio includes real estate funds, government bonds, and equities in emerging markets such as cannabis, artificial intelligence, and cryptocurrencies.