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Finsocial will apply for a license to operate as a digital bank in Colombia

October 26, 2020

The finsocial company will apply for a license to operate as a digital bank in Colombia from next year. This was reported by the Colombian fintech website which had an article from La República as its source.

“”The banking system is preparing for the arrival of new players next year. In addition to requests from BTG Pactual, JP Morgan and Lulo Bank to act as banks in the country, there is also that of Finsocial, a company that provides loans to teachers and retirees in Colpensiones’ public sector, the Fopep (Public Pension Fund). Casur (National Police Pension Funds), Positiva and Fiduprevisora, ”they stated in the article.

In addition, it was according to the publication Santiago Botero, CEO of Finsocial, confirmed that he expects fintech to become a 100% digital bank by the first half of next year. However, this depends on the time it takes for the financial superintendency’s validations and analysis to issue the license.

Finsocial will apply for a license to operate as a digital bank in Colombia
Finsocial will apply for a license to operate as a digital bank in Colombia

Santiago Botero said: “A new partner comes to Finsocial. There are five interested companies and I estimate that full details of this transaction will be known before year end. The companies behind this operation are foreigners, there are North Americans, and there is also a very large European fund. “The article also clarified that when the process is complete, the license will be requested.

Finsocial’s CEO also spoke about the basics of this initiative to become a bank, saying it was because they have the resources to make it happen, but also because they have already done what he’s been called for considered this type of company to be “the hardest” to “learn to borrow and manage risk. “

Botero has also provided some details on how the company works, taking into account, among other things, the experience it has had in the sector. When the Superfinanciera gives them the guarantee, they hope to raise funds, offer other lines of credit, and have a credit card.

In this scenario he emphasized: “We’ll do the papers with Mastercard, but I think we’ll have it with Visa too”.

They are also hoping for a savings account that will offer users a return. They also want to have recording mechanisms like CDTs.

“With the establishment of Finsocial, Lulo Bank, JP Morgan and BTG Pactual as banking companies in the coming months, the Colombian financial system will complete 29 banks, which so far have been confirmed to be two neobanks, which are Finsocial and Lulo Bank. It is clear that Nubank will not yet function as a bank in Colombia, ”said Fintech from Colombia.

“Amid this avalanche of applications and the fact that around 90% of communities in Colombia are not yet implementing electronic payment systems, according to a Visa study,” they later added.

It should be noted that for Botero Thinking about a digital offering is not a limitation as they would use the 29 offices they currently have as anchors to teach users about digital banking.

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