Habeas Data Bill Moves Forward: BanRep Opens Consultation on Payment Systems and SFC Calls for Interest Rate Cuts
23 abril 2020

On April 23 the House of Representatives’ First Committee members, César Lorduy (Cambio Radical – allied with the ruling party) and Harry Giovanny González (Partido Liberal – Independent), presented the report on the Habeas Data Bill, also known as the ‘clean slate in the Credit Risk Centers’.  This document introduces some technical modifications to the text passed by the Senate in December 2019. In other news, the Banco de la República de Colombia (BanRep) launched a public consultation on payment system liquidity. Those interested may send their comments until April 28 here. In addition, the Financial Superintendent, Jorge Castaño, urged financial institutions to cut interest rates and the Executive took measures to promote the development of Fintech companies in the context of the emergency. 

The Habeas Data bill proposes reducing  the time that debtors are listed in risk centers from a maximum of four to two years. The initiative is being driven by by Senators Luis Fernando Velasco (Partido Liberal – Independent) and David Barguil (Partido Conservador – allied with the ruling party), and was adopted by the Senate on December 3, 2019. Thus, it must be approved in the House of Representatives before June 20, 2020 or it will lose its validity. It is expected that the initiative will begin to be discussed in the House of Representatives’ First Committee in the coming weeks. 

Also the Financial Superintendent, Jorge Castaño, attended a meeting of the House of Representatives’ Third Committee to report on the measures taken by the Superintendency regarding the crisis. He considered that, at this point, banks have the capacity to take on greater risks and reduce interest rates. “There is enough room to lower interest rates for a specific amount of time; in fact, some banks have already been able to do so for credit cards,” he explained, adding that this measure would represent “an act of solidarity given what is happening in the country and in the world.” He also suggested that the entities segment interest rates according to the types of client. 

The BanRep regulation bill seeks to guarantee the economy’s liquidity and make the normal functioning of the payment system easier. The idea is to include securitization companies and the Financiera de Desarrollo Nacional S.A. as agents authorized to carry out monetary expansion operations, temporarily and permanently, within the framework of the Economic and Social Emergency decreed in the wake of the COVID-19 pandemic.

Finally, the Ministry of Commerce authorized the first Fintech company to implement a credit line for entrepreneurs and self-employed workers in order to mitigate the effects of COVID-19 on finances in this sector. As of April 24, Zinobe will provide loans of up to USD 1100, with a 12-month term for debt cancellation. 

The Ministry of Information and Communication Technologies (MinTIC in Spanish) has launched a new virtual fintech program for entrepreneurs helping participants to expand their knowledge on digital banking and crowdfunding. “The Fintech ecosystem in the region is in a stage of growth and consolidation, with important advances in regulatory matters,” said the head of MinTIC, Sylvia Constaín.