Body
FinTechs belonging to this category operate crowdfunding, crowdinvesting and crowdlending platforms on which money is raised to invest in various projects, mainly start-up companies and real estate projects.
Crowdfunding is not a defined financial service, but generally used to describe donation-based crowdfunding (the investor donates the money to the project), reward-based crowdfunding (the investor receives an often symbolic consideration for his investment), equity-based crowdfunding (crowdinvesting: the investor participates in the profits of the financed project or acquires shares or debt instruments) or lending-based crowdfunding (crowdlending: the investor is reimbursed at the end of the project with or without interest).
Introduction
Attitude of the country towards crowdfunding, crowdinvesting and crowdlending platforms
The crowdfunding, crowdinvesting, and crowdlending segment remains a small but fast-growing vertical within the Argentine fintech ecosystem. In 2020 it comprised 11 players (˜4 % of the 268 fintechs at that time), yet by 2023 broad lending and investment platforms accounted for approximately 12 % of fintechs (˜40 out of 343) . Over 30 companies are active in the credit space alone .
Legal affairs
Obligations and requirements to provide crowdfunding, crowdinvesting and crowdlending platforms described above
Crowdfunding and crowdinvesting activities have been expressly regulated in Argentina through Law 27,349 ('Ley de Apoyo al Capital Emprendedor') enacted in 2017. Law 27,349 requires crowdfunding platforms to register before the CNV as 'Plataformas de Financiamiento Colectivo' and comply with the information and surveillance regime set forth in Resolution 717/2017 dictated by CNV.
Additional comments regarding the legal situation for crowdfunding, crowdinvesting and crowdlending platforms or what FinTech’s must be aware of in this business area
Although Law 27,349 regulates both crowdfunding and crowdinvesting activities, the crowdlending activity has been intentionally excluded from regulation by Law 27,349. This represents a problem for crowdlending companies which are exposed to the risks of carrying out their activities lacking a clear legal framework applicable to their business. The absence of regulation in the crowdlending segment discourages this activity to continue growing and exposes the already existing companies to legal proceedings that could be initiated by the CNV as regards to potential sanctions for irregular offering of securities or financial intermediation without the corresponding authorisation from CNV.
Economic conditions
Market size for crowdfunding, crowdinvesting and crowdlending platforms and biggest companies in this business area
The crowdfunding, crowdinvesting, and crowdlending sector remains a marginal and poorly documented segment within Argentina ’s broader fintech ecosystem. Despite the existence of a regulatory framework for peer-to-peer lending platforms (PSCPPs) established by the Central Bank of Argentina (BCRA) in 2022, official information about the actual number of operational companies in this space is scarce