New standards in the regulation of credit fintechs
The National Monetary Council (CMN) approved a series of changes proposed by the Central Bank of Brazil concerning the regulation of credit fintechs. Among the changes are the authorization for issuing credit cards and receiving transfers from the Economic and Social Development National Bank (BNDES) by the Direct Credit Companies.
CMN has also expanded the scope of funds with which Personal Loan Companies and Direct Credit Companies can assign their portfolios. Originally, these transactions could only be made with credit rights investment funds whose shares were held by qualified investors. With the change, operations may be made with other types of funds, provided that their shares are destined exclusively to qualified investors.
Another modification concerns the form of shareholding control of fintechs involving investment funds, specifically private equity. Under the new regulation, control may be exercised by those funds indirectly, by means of a legal entity located in Brazil, whose exclusive corporate purpose is to hold equity interests in financial institutions. More information at: http://www.in.gov.br/web/dou/-/resolucao-n-4.792-de-26-de-marco-de-2020-250188818 and https://www.bcb.gov.br/pre/normativos/busca/downloadNormativo.asp?arquivo=/Lists/Normativos/Attachments/50579/Res_4656_v1_O.pdf (in Portuguese)
