April 24, 2019

BCB published a communication regarding the supervision of open banking model in Brazil. The collegiate Board of the Central Bank of Brazil, in a meeting held on April 23, 2019, approved the fundamental requirements for implementation of the open banking system in Brazil. The Open Banking initiative is expected to be implemented in the country from the second half of 2020.

BCB considers open banking to be sharing of certain information by financial institutions and other authorized institutions at the discretion of its clients. The scope of the model to be adopted in Brazil should cover financial institutions, payment institutions, and other institutions authorized to operate by BCB, including. The institutions should provide at least the following metrics:

  • Data on products and services offered by participating institutions (location of service points, product characteristics, contractual terms and conditions and financial costs, among others)
  • Customer registration data (name, affiliation, address, among others)
  • Transactional customer data (data related to deposit accounts, credit operations, other products and services contracted by customers, among others)
  • Payment services (initialization of payment, transfers of funds, payments of products and services, among others)

With regard to the process of implementation of Open Banking, the publication of normative acts and self-regulation initiatives are foreseen. As for normative acts, BCB expects to submit a public consultation in the second half of 2019, with the proposals covering several aspects such as definition, scope, responsibilities, minimum requirements for operation of the model, internal controls, risk management, and minimum conditions for the contractual relationship that may be established between authorized institutions and unauthorized third parties, in addition to the implementation schedule. As per the BCB communication, the implementation of the model will occur in phases established as per a schedule. First, the institutions that are members of the prudential conglomerates of segments 1 (S1) and 2 (S2) will be required to participate. Subsequently, this obligation may be extended to the other institutions, at the discretion of the Central Bank of Brazil. Furthermore, BCB expects that the participating institutions will be responsible for technological standardization and operational procedures, safety standards and certificates, and the implementation of interfaces, all in accordance with the regulations.

 

Related Link (in Portugese): BCB Communiqué

 

Keywords: Americas, Brazil, Banking, PMI, Open Banking, Risk Management, Internal Controls, BCB

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