Economy

Brazil's Central Bank publishes a list of 1,065 institutions that are required to participate in open banking

All major banks in the country join the group, which is also made up of smaller, cooperative institutions

Photo: REUTERS/Adriano Machado
  • Open banking will give customers of financial institutions the power over their registration and transaction data;
  • By the end of November, Brazil’s Central Bank announced the postponement of the kick-off of open banking to February 2021.

Brazil’s Central Bank released on Friday a list of 1,065 institutions that will have mandatory participation in open banking regulation, which will be implemented in the country from 2021.

All major banks in the country join the group, which is also made up of smaller, cooperative institutions.

READ ALSO: Brazilian fintech Cora wants to surf the wave of new financial regulations in the country

Open banking will give customers of financial institutions the power over their registration and transaction data as a means of fostering competition and access to cheaper and better services.

The regulation of open banking had already stipulated the mandatory participation of institutions covered by the Central Bank in segments 1 (S1) and 2 (S2).

Institutions with a size equal to or greater than 10% of the Gross Domestic Product (GDP) or that carry out a relevant international activity, regardless of size, enter in S1 group.

S2, on the other hand, is composed of institutions with a size of less than 10%, but greater than 1% of GDP.

READ ALSO: “We haven’t seen even 1% of what’s coming,” says Brazilian fintech BizCapital co-founder about country’s Central Bank innovation agenda

The complete list of mandatory open banking participants is available here.

By the end of November, Brazil’s Central Bank announced the postponement of the kick-off for the implementation of open banking to February 2021. Before, the first stage of the process was to be completed by November 30 this year.

The deadline for the last stage of open banking – the entry into force of data sharing on products and services and transaction data – was October 25, 2021, and changed to December 15, next year.

In a note, the Brazilian Central Bank stated that with the necessary efforts to combat the COVID-19 pandemic, the government understood that the work processes in the institutions participating in open banking were impacted.

“It was also taken into account the need to adapt the systems of the institutions due to other regulatory actions, such as PIX and the registration of card receivables”, added the monetary authority.

(Translated by LABS)

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