Regulatory sandboxes are becoming more widespread in Latin America, in a bid to drive innovation in banking and fintech. However, adoption is still early and uneven across countries in the region. Regulators in Mexico, Colombia and Brazil are leading the way. Others, such as Peru and Chile, have not yet defined their path towards a fintech sandbox. The goal of a sandbox is to offer a space for novel business models to test out their projects in a controlled environments, with both user numbers and time limited. This allows companies to test the potential of new ideas without needing to fully comply with strict financial services regulations. For some experts, the long-term idea is to bring all these environments together in a single digital market in Latin America, where companies with a presence in different markets can trial businesses in several jurisdictions at the same time, as Diego Herrera, a representative of the Inter-American Development Bank (IDB), explained to iupana. Mexico is a pioneer in sandbox regulation in Latin America. The country introduced its “novel models” regulation in March 2018, as part of the enactment of its Fintech Law. Unlike other countries in the region, Brazil has three regulatory sandboxes, separated into industries: financial and payment systems, capital markets and private insurance markets. In Colombia there are two types of isolated systems. The first is La Arenera, created in 2018 by the Financial Superintendence of Colombia (SFC) as a supervised space. The second is a regulatory sandbox originated last September by the Ministry of Finance through Decree 1234.

https://iupana.com/2021/03/29/regulatory-sandbox-in-latam/?lang=en