Roundup: Uruguay cenbank innovation focus, Paraguay financial inclusion strategy

Uruguay’s central bank is sharpening its focus on the sphere of emerging financial services technology.

Officials agreed to advance three associated initiatives: the creation of an innovation observatory, an office of innovation and an innovation node.

Technological changes call for adaption and associated strategies, as well as collaboration with various stakeholders, the bank said in a resolution. 

The move comes after officials created a roadmap for the development of the country’s payment system through 2022, which encompasses areas including open banking. One pillar of the initiative involves supporting competition and innovation.

Key objectives of the innovation observatory are planning associated activities, establishing priorities and supporting analysis of possible legal or regulatory changes.

Tasks of the office of innovation – which will be established for six months – include taking a lead role in the execution of projects outlined by the observatory and feeding back results and findings, as well as conducting research.  The office will be required to publish a final report. 

The innovation node will constitute a platform for the sharing of knowledge and experience between the public and private sectors. The node will also be involved in project execution, providing the requisite infrastructure and exploring regulatory impacts.  

One of Latin America’s unicorns, payments solution dLocal was born in Uruguay. Another local fintech that has expanded out of the country is open banking platform Prometeo. 

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Paraguay’s national financial inclusion committee CNIF agreed to update the country’s financial inclusion strategy, created in 2014.

Officials said the move was necessary, citing challenges presented by the health crisis, state news agency IP reported.

Multilateral development bank Fonplata – established by Argentina, Bolivia, Brazil, Paraguay and Uruguay to support development in the River Plate basin – has provided a grant to help authorities hire specialists in the area.

Paraguay has a financial inclusion bill in congress. 

CNIF is headed by the finance ministry. Other members comprise representatives of the central bank, government planning department STP and national cooperatives institute Incoop. 

According to the World Bank’s Global Findex survey, 48% of adults had an account in Paraguay in 2017, compared with 49% in Argentina, 64% in Uruguay, 70% in Brazil and 74% in Chile.

The database defines account ownership as having an individual or jointly owned account either at a financial institution or through a mobile money provider.

Picture credit: Norberto Duarte/ AFP