Publications

On the intent of suiting to new technologies, Central Bank starts to regularize Fintechs

October / 2019

In order to adapt to new technologies, the Central Bank of Brazil, also known as “BACEN”, by the resolution nº 4.656/2018, regularized two new Credit Societies: (i) the Direct Credit Society; and (ii) Peer-to-Peer Lending Society.

The companies known as fintechs are startups on the financial sector, using an electronic platform, as a website or a mobile app, to perform its activities as a facilitator between creditors and borrowers. Some of their activities are Loaning Operations, Financings and Collection of Third-Party Credits.

The regulation of Fintechs intends to simplify financial operations that were only executed by traditional banks. Consequently, through an accessible digital platform more transparency and the reduction of rates are expected.

To facilitate the understanding, vlm|a organized similarities and differences between these two new types of business structures:

Direct Credit SocietyPeer-to-Peer Lending Society
Main Characteristics
  • It is a Financial Institution;
  • It is a company that operates exclusively on a digital platform;
  • Must operate with its own resources;
  • Needs to permanently observes the minimum limit of R$ 1.000.000,00 (a million reais), related to the paid-up Share Capital and the net equity; and
  • Its constitution must be under the procedure of a Joint-stock Company
  • It is a Financial Institution;
  • It is a company that exclusively operates on a digital platform;
  • Cannot operate with its own resources, but only mediate creditors and debtors;
  • Need to permanently observes the minimum limit of R$ 1.000.000,00 (a million reais), related to the paid-up Share Capital and the net equity; and
  • Its constitution must be under the procedure of a Joint-stock Company
Activities that can be performed
  • Loaning Operations;
  • Financing Operations;
  • Acquisition of credit rights;
  • Credit analysis for third parties;
  • Collecting of Third-Party Credits;
  • Acting as an insurance representant on loaning and financing operations executed through the digital platform; and
  • The issue of digital currency.
  • Loaning Operations;
  • Financing Operations;
  • Credit analysis for third parties;
  • Collecting of Third-Party Credits;
  • Acting as an insurance representant on loaning and financing operations executed through the digital platform; and
  • The issue of digital currency.
Prohibitions
  • Participate of the capital share of financial institutions; and
  • Raise public resources, with the exception on issue of shares.
  • Perform loaning and financing operations with its own resources;
  • Participate of the capital share of financial institutions
  • Co-obligate itself or provide guarantees on loaning and financing operations, except in the hypothesis of the art. 10, of the resolution;
  • Reward or use in self-benefit the resources related to loaning and financing operations;
  • Transfer resources to creditors before the debtors’ payment;
  • Maintain creditor or debtor’s resources in accounts of its titularity, not attached to their operations;
  • Attach the remittance of the credit operation on third-parties or on the debtor (in the quality of entrepreneur); and
  • The financial resources and representative instruments of the credit linked to financial operations can’t be used, directly or indirectly, to guarantee the payment of debts of the company


Besides that, these kinds of companies, on the moment of their constitutions, become financial institutions by the Nacional Financial System, regulated and controlled by BACEN. Then, aiming to have a better regulation on the constitution of these companies, The Central Bank of Brazil issued in 17th may 2018 the Release nº 9.868, which defined the minimal requirements to authorize the operation of theses societies.

According to the Release, these Societies will operate through authorization of the Central Bank, which will examine documents and information, such as: (i) company’s articles of incorporation; (ii) documental proof of the paid-in capital; (iii) administrators and shareholders owner equity and; (v) foreigner shareholders.

vlm|a is at the disposal of its clients for more information on the subject.