The Ministry of Finance and Public Credit recently circulated a substantially amended draft of the Financial Technology Bill, which has been renamed the Financial Technology Institutions (FTIs) Law. The law aims to regulate the financial services provided by FTIs – including those which are bound to specific regulations and offered or rendered through innovative means – as well as the organisation of such institutions and their operations.
In recent years, Mexico has been rated as having one of the highest rates of credit card fraud in the world. The National Banking and Securities Commission recently published the Resolutions that Modify the General Rules Applicable to Credit Institutions, which require credit institutions to verify information and documentation filed by users and customers with different government bodies in order to assure the identity of each prospective customer.
The recently published draft Financial Technology Law will regulate the organisation, operation, function and authorisation of companies that offer alternative means of access to finance and investment, the issuance and management of electronic payment funds and the exchange of virtual assets or cryptocurrencies. Among other things, the initative aims to take advantage of the opportunity to expand the financial market to include segments not covered by traditional banking institutions.
President Enrique Peña Nieto recently presented the Financial Reform Bill to Congress. The government stated that the bill would encourage the country's development banking system to lend more actively. At the same time, the government proposes to reduce the cost of borrowing by promoting greater competition among the largely foreign-owned banks.
An executive order promulgating the Federal Act to Prevent and Identify Illegally Funded Transactions was recently published in the Federal Official Gazette. The purpose of the act is to detect and investigate activities and transactions involving resources that have been illegally obtained.
One of the main purposes of the Basel III agreement is to improve the regulatory framework of banks and strengthen the global financial system. Although Basel III will not become effective until 2013, Mexico intends to implement its guidelines during the second semester of 2012. This is largely due to the favourable conditions prevailing in the Mexican banking system.
An executive order has amended several provisions of the Auxiliary Financial Institutions Law to impose rules for non-regulated multi-purpose financial institutions, money exchange centres and other entities with respect to money laundering and terrorism financing. The amendments also create the legal concept of a 'money transmitter'.
A decision has published in the Official Gazette that establishes the procedure for making and annotating records in the Personal Property Security Registry. It is intended to allow all new filings, annotations, terminations and notices regarding the registry to be entered digitally using specific forms.
The financial authorities have been systematically collecting information on cash transactions in US dollars within Mexico's financial system. Their analysis has revealed a considerable volume of excess US dollars - potentially originating from illegal activities - being held in cash by financial entities. Several additional control measures for dollar cash transactions have now been published.
Although only a minority of its citizens have access to banking services, Mexico has a fast-growing mobile phone industry. The National Banking and Securities Commission has introduced a new concept – the mobile banking agent management company – and has set out a comprehensive system for branchless banking services.
The Movable Assets Registry facilitates the granting of loans to small and medium-sized companies, as many such companies do not own real estate and their owners are unwilling to use their personal property as security. The new registry will allow certain institutions, such as financial leasing companies, to offer loans in the small business market.
The Bank of Mexico has issued the General Guidelines on the Collection of Bank Charges. The guidelines aim to eliminate inappropriate practices in connection with bank charges, ensuring that such fees and the mechanisms for their collection are transparent and that charges are incurred only for services rendered.
An order modifying the General Rules Applicable to Financial Institutions is intended to encourage lending and boost the economy. Reassessing the role played in the banking system by guarantees from public trusts and similar entities has allowed the National Banking and Securities Commission to authorize temporary higher financing limits for development banks with such guarantees.
Amendments to the Financial Institutions Law aim to protect users of financial services by limiting the transactions that financial institutions may perform as commission agents. Other legislative changes require institutions to provide customers with the information needed to make investment decisions, and make them liable for damages and lost profits if they fail to do so.
The Ministry of Finance has published a new set of rules on money laundering to be adopted by commercial banks. The new rules are intended to create a modern regulatory scheme to combat organized crime and prevent money laundering through financial transactions. Among other things, banks are required to maintain a clear and precise customer identification policy and procedure.
The new Credit Union Law has introduced corporate governance rules that promote development and specialization. It has also established guidelines on prudent regulation and has expanded the range of transactions that credit unions may perform. The law will encourage the healthy development of the banking system, as new competitors will provide a wider range of services to customers.
Significant recent amendments to the Banking Law give the National Banking and Securities Commission sole regulatory responsibility for the supervision and regulation of the banking sector. Among other things, they also provide rules on setting minimum paid capital levels for full-service and limited-service banks.
The Ministry of Finance has published new rules on capitalization requirements for banks. The rules correspond to the Basel II Capital Accord and aim to introduce a more modern regulatory scheme which is more responsive to risk and follows the international consensus on the subject.
The National Banking and Securities Commission has published a set of rules which implement aspects of the Financial Services Transparency Law. The rules deal with adhesion contracts and advertising to customers of financial entities, imposing greater requirements in terms of transparency and protection of the public interest.
Pledges without transfer of possession were introduced into the Mexican legal system in May 2000, together with guarantee trusts, in amendments to the Commercial Code and the Law on Negotiable Instruments and Credit Operations. The pledges were unpopular with banks, but changes to the implementing regulations have helped to increase the credit available.