API-Banking:

BaaS – Bank as a Service/BaaP – Bank as a Platform:

Introduction

Attitude of the country towards online-banking services

• Online banking is fully legal and promoted under:
• Ley de Servicios Financieros (Ley N° 393)
• ASFI’s rules on digital channels, cybersecurity, and authentication.
• Banco Central de Bolivia (BCB) supports payment digitalization, including electronic transfers and mobile payments.
• The government views digital banking as a key driver for financial inclusion and modernization.

• Expand financial inclusion, especially in rural or semi-urban areas with limited branch presence.
• Reduce informality by decreasing cash-based transactions.
• Increase efficiency and transparency in the financial system.

• Most major banks (e.g., BNB, Banco Mercantil Santa Cruz, BancoSol) offer online platforms and mobile apps.
• Services include transfers, bill payments, loan applications, investments, and QR/e-wallet payments.
• Digital ID initiatives are improving secure online account access.

• Online banking is under strict ASFI oversight, requiring:
• Cybersecurity measures and 2FA (two-factor authentication).
• Transaction monitoring and anti-fraud systems.
• Consumer protection and service availability standards.
• Banks must report incidents and usage data to ASFI.

• Only licensed banks can offer full online banking, but fintechs can:
• Partner with banks to provide customer-facing tools.
• Offer account aggregators, budgeting, analytics, or onboarding solutions.
• Regulatory sandbox (DS N° 5384) supports pilot projects that complement or enhance digital banking services.

Legal affairs

Obligations and requirements to provide online-banking services described above

• Only ASFI-licensed financial institutions (e.g., commercial banks, development banks, savings and credit cooperatives, or fintechs in the regulatory sandbox) can provide online banking services.
• Fintechs cannot operate independently unless they:
• Partner with a licensed bank or cooperative, or
• Obtain sandbox approval (under DS N° 5384) and later transition to a regulated financial entity.

• Must be a regulated financial entity (e.g., Banco Múltiple, Banco PYME).
• Submit to ASFI:
• Service scope and features
• Platform infrastructure design
• Risk management and mitigation plans

• Platforms must comply with ASFI cybersecurity standards, including:
• Data encryption (TLS/SSL) and secure hosting
• Disaster recovery systems
• Secure APIs and real-time monitoring

• Mandatory measures:
• Two-factor authentication (2FA)
• User credential management
• Fraud detection and monitoring tools
• Security Incident Response Plan (SIRP)

• Provide transparent terms, robust data privacy (Law N° 164), and accessible user support channels.

• Regular reports on:
• Transaction volumes and service uptime
• Cybersecurity incidents or fraud attempts

• Full KYC for remote onboarding
• Transaction monitoring and suspicious activity reports (SARs) to the UIF.

Additional comments regarding the legal situation for online-banking services or what FinTech’s must be aware of in this business area

• Online banking is not a separate license; it is just a digital delivery channel for financial services.
• Only entities authorized and supervised by ASFI under Ley N° 393 can offer online banking.
• Fintechs cannot operate as full banks unless they:
• Obtain a financial entity license, or
• Operate temporarily under ASFI’s regulatory sandbox (DS N° 5384, 2025).

• Bolivia enforces bank-grade security standards, including:
• Two-factor authentication (2FA) for logins and transactions.
• Real-time fraud and risk monitoring systems.
• Encrypted data transmission (SSL/TLS).
• Compliance with Law N° 164 on Telecommunications and ICTs (data privacy and personal data protection).
• Fintech platforms must be built to meet these standards from the start.

• ASFI requires digital channels to ensure:
• Clear service terms, fees, and risks.
• Accessible terms and conditions.
• Complaint and dispute resolution mechanisms.

Economic conditions

Market size for online-banking services and biggest companies in this business area

• Recent ASFI and BCB figures show that about 48% of Bolivians engaged in digital payments in 2024, with 15.2% using phone or internet transfers and 13.9% paying bills online. (https://www.accion.org/digital-financial-inclusion-in-bolivia-transforming-microfinance-with-bancosol/?utm_source=chatgpt.com).
• Coverage of the financial system reached 91.2% of municipalities by mid-2024 – indicating broad outreach, though rural usage is still lower.
• Statista forecasts online banking penetration of only ~12% of the population by 2029, suggesting lower transactional penetration than claimed. ( https://idp.canberra.edu.au/idp/profile/SAML2/POST/SSO)

• QR-based transfers grew over 4,700% from 6 million in 2021 to 290 million transactions by October2024.( https://bolivianthoughts.com/2024/12/21/bolivia-electronic-payment-methods-medios-electronicos-de-pago/?utm_source=chatgpt.com)
• Electronic fund transfers (OETF) rose 333% from 94 million in 2021 to 407 million by late 2024.
• Digital payments and transfers increased sharply, driven by mobile access, government disbursements, and COVID-era trends

• Payment ecosystem processed over 1.0038 billion transactions in 2024, valuing around Bs 1.0002 trillion (~USD 145 billion equivalent). Of this, only ~3% (~Bs 23.8 billion) came directly via online/mobile banking platforms. The bulk was through interbank transfers via financial infrastructure. (https://rankingslatam.com/es-la/blogs/industry-news/credit-and-debit-cards-market-in-bolivia-december-2024-rankings?utm_source=chatgpt.com)
• Thus, the figure “USD 75 billion moved digitally” may be inflated: actual online/mobile banking transactions seem closer to ~3% of total volume, not dominant.

• Individual (retail) digital transfers and payments account for a large share.
• SME/digital tools are growing but less mature.
• Utility/tax QR payments and OETF are significant categories. (https://www.cryptoninjas.net/news/bolivias-crypto-boom-430m-in-transactions-as-virtual-asset-payments-surge-630-in-a-year/?utm_source=chatgpt.com)

• BancoSol (BancoSol digital tools for microfinance inclusion).
• Banco BISA offering custody services for stablecoin assets like USDT via regulated mechanisms.
• Others like BNB, Mercantil, BCP, Banco Unión, Ecofuturo and BancoSol have established mobile portals or wallets (Yape Bolivia, Tigo Money, BNB wallet, Viva’s CASH app etc.s.

• On May 7, 2025, Bolivia issued Supreme Decree 5384, formally recognizing and regulating fintech entities (FTCs), enabling sandbox testing and regulation for blockchain, tokenized assets, virtual assets, and API platforms.
• Fintech remains dependent on bank partnerships or BaaS (Banking-as-a-Service) frameworks; independent digital banks are not permitted unless licensed.
• Notable entities and services include Solven, Pibox, Tigo Money, Yape Bolivia, Pago Simple/CASH, operating through digital wallets or via partnership with banks Wikipedia.
• Crypto-related banking services are expanding: Banco Bisa custody of USDT and Binance-powered virtual asset volume surged to $430 million in June 2025.

Additional comments regarding the economic situation for online-banking services or what FinTech’s must be aware of in this business area

• Around 85% of employed Bolivians work informally as of late 2023—not covered by formal labor protections or taxation.
• This informal employment level limits traditional financial inclusion and challenges digital adoption.

• In early 2024, internet penetration stood at around 73%, with mobile connections exceeding population size (~109%).
• Smartphone ownership and mobile internet access are widespread in cities; ~90% of internet usersaccess via mobile networks.
• Government social programs, cashback remittances, and utility payments increasingly use digital channels.

• Remote areas still lack reliable connectivity, face digital literacy gaps, and suffer high mobile-data costs.
• Mobile internet speeds are among the slowest in Latin America, and the rural digital divide remains sizeable.

• Most Bolivian banks offer free basic digital banking services.
• Revenue is mostly derived from:
• Digital lending (loan origination & monitoring).
• Payment transaction fees.
• Cross-selling insurance, investment, or savings products via their digital channels.

• Must align with:
• Regulatory fee caps.
• Users’ price sensitivity, especially in low-income and informal segments.
• Monetization strategies often rely on value-added services within a partnership or BaaS model rather than standalone revenue streams.

• Traditional banks lead, backed by licensing, consumer trust, and scale.
• FinTechs appear mainly as enablers, offering:
• UX enhancements (simplified interfaces, onboarding flows).
• APIs for bank integration.
• Data analytics, credit scoring, and AI-driven financial products.
• Informal systems remain strong competitors, offering trust and access through community-based mechanisms outside formal banking.

• Operating within ASFI’s regulatory framework requires investment in:
• Cybersecurity infrastructure.
• Anti-money laundering (AML) systems.
• Consumer protection, KYC (Know Your Customer) verification tools.
• Continuous monitoring and reporting.
• These requirements favor larger or more capitalized organizations—or fintech-bank partnerships, which can pool resources and compliance expertise.