FinTechs belonging to this category provide identification services, which are required for most banking services.
Attitude of the country towards identification services
The use of FinTech belonging to this category is increasingly common and has become more widespread as the digitisation of banking has become more widespread.
Obligations and requirements to provide identification services
There is no specific regulation regarding FinTechs in this line of business. Accordingly, and apart from compliance with general rules applicable to service providers, there generally are no specific license, minimum capital, or liquidity requirements.
However, in case the identification services consider the processing of data that are considered to be of personal or sensitive nature, its collection and management would be protected by law. In this regard, Chilean law currently defines personal data as “any information concerning identified or identifiable natural persons”, and sensitive data as “data referring to people’s physical or moral characteristics, or facts or circumstances of their private life or intimacy, such as personal habits, racial origin, ideologies and political opinions, religious beliefs, physical or mental health states and their sexual life”. Furthermore, regarding data of economic, financial, banking, or commercial nature, Chilean data privacy laws establish limitations of the documents under which such obligations shall be evidenced in order to be communicated and years of the obligations that may be communicated.
Currently, there is a bill in congress which is aimed at strengthening Chile’s data privacy regime which even considers the creation of a governmental agency with faculties to oversee its compliance and fine breaches to the same.
Additional comments regarding the legal situation for identification services or what FinTech’s must be aware of in this business area
Market size for identification services and biggest companies in this business area
In terms of the types of markets where FinTech companies compete, the growth of the score, identity and fraud segment has gone from two (2) to 12 start-ups, making it the fifth largest segment of the ecosystem, under which the emergence of companies dedicated to offering security and digital identity services stands out.
Information regarding revenues and customers is not readily available.
Additional comments regarding the economic situation for identification services or what FinTech’s must be aware of in this business area