This document describes the Chile FinTech landscape, approaching the analysis from a FinTech, regulatory, Investment and talent standpoint. This document serves as a snapshot of the key pillars of a FinTech ecosystem in a country and provides a good overall view of the state of FinTech at a glance. Chile has a population of 18m people as of end-2017 and mobile internet users account for 72% as of January 2018 according to Wearesocial. Chile’s government is spurring innovation through investments in startups and loosening restrictions for larger companies looking to penetrate the Latin American market. Key Findings: - Chilean FinTechs are driving financial inclusion and SME finance - Chile’s regulators have recently moved to increase regulatory clarity for FinTechs. - As of year end 2017, according to Finnovista, there were a total of 75 FinTech startups in Chile, a 34% increase from 2016. The top FinTech segments in Chile is Payment and Remittances, Enterprise Financial Management and crowdfunding at 30%, 16% and 15% of the total number of FinTech startups respectively. - A survey conducted by Finnovista showed that 22% of startups operate beyond the national border and the main market where Chilean startups operate in is Mexico (33%). Chile’s FinTech ecosystem is relatively young with 81% of the FinTechs surveyed by Finnovista being created during the last 4 years. - 40% of Chilean FinTechs have a focus on the underbanked and unbanked population. Financial inclusion in Chile have been improving with 63% of the population above 15 years old having access to a bank account. - FinTech Association of Chile, the industry association, was launched in March 2018 with the purpose of promoting and strengthening the 4 pillars for the proper development of the Fintech industry, namely Public policies and regulation; Education, development and attraction of talent; Attraction of capital and investments; and Promoting the use of Fintech business services. as of October 29, the association had 21 members. - Chilean startups can access funding from both public and private sources. On the public side, Production Development Corporation (CORFO), founded in 1939, aims to promote economic development in Chile. For every $1 funds invested, the CORFO can match an additional US$2 or US$3 with low interest debt. CORFO also sponsors Chilean incubators up to US$310k in grants for operations each year. There are 18 incubators listed on CORFO’s site in 2016. -Start-upChile, launched in 2010, is an accelerator with 2 mandates: to elevate Chile’s international profile and to build out a local culture of entrepreneurism. It offers up to CL$50 million (80K USD) in equity free funding across its programs & over 100K of perks as a participant and has attracted technology entrepreneurs from all over the world. As of October 2018, Start-Up Chile has worked with over 1,300 startups, 51% of which are still active.

1. Overview
Chile has a population of 18m people as of end-2017 and mobile internet users account for
72% as of January 2018 according to Wearesocial. Chile’s government is spurring
innovation through investments in startups and loosening restrictions for larger companies
looking to penetrate the Latin American market.
FinTech Ecosystem
FinTechs
As of year end 2017, according to Finnovista, there were a total of 75 FinTech startups in
Chile, a 34% increase from 2016. The top FinTech segments in Chile is Payment and
Remittances, Enterprise Financial Management and crowdfunding at 30%, 16% and 15% of
the total number of FinTech startups respectively.
A survey conducted by Finnovista showed that 22% of startups operate beyond the national
border and the main market where Chilean startups operate in is Mexico (33%). Chile’s
FinTech ecosystem is relatively young with 81% of the FinTechs surveyed by Finnovista
being created during the last 4 years.
40% of Chilean FinTechs have a focus on the underbanked and unbanked population.
Financial inclusion in Chile have been improving with 63% of the population above 15 years
old having access to a bank account.
FinTech Association of Chile, the industry association, was launched in March 2018 with the
purpose of promoting and strengthening the 4 pillars for the proper development of the
Fintech industry, namely Public policies and regulation; Education, development and
attraction of talent; Attraction of capital and investments; and Promoting the use of Fintech
business services. as of October 29, the association had 21 members.
Regulators
As of August 2018, there was no general legislation that regulate FinTechs but financial
regulators are paying close attention to the sector and tempering its impacts on oversight
models though piecemeal measures. For example, the SBIF (Chilean banking oversight
authority) issued instructions to banks on cybersecurity matters in response to the growing
use of information technologies in financial markets.
The absence of a general regulatory framework for FinTechs has limited the legal certainty
with which some of these services operate in the country. Nor has Chile put in place any
regulatory sandbox to allow companies to test new FinTech products, models and operating
standards under the supervision of the regulatory authorities.
These regulatory gaps have been brought to the attention of the authorities by different
Chilean FinTech associations, which are lobbying for a specific regulatory framework that: (i)
defines FinTech services and business models in the areas of electronic payments,
crowdfunding and virtual assets; (ii) expressly authorizes FinTech experimentation, with
temporary approval through a regulatory sandbox; (iii) promotes open banking, establishing
guidelines for the relationship between banks and FinTechs; and (iv) levels the playing field by
guaranteeing access to the payment infrastructure and laying down risk-adjusted prudential
requirements.
Chile
Industry
Associations
► FinTech Association
of Chile
► Payment and
Remittances
► Enterprise Financial
Management
► Crowdfunding
F O C U S

2. In March 2018, Catherine Tornel, the Finance Ministry’s capital market said that the
regulators in the country were drafting regulations covering FinTechs, including
cryptocurrency firms. Along with the draft regulations, stakeholders were also drafting
sandbox rules for developers to test their products in the market without being subject to
some or all legal requirements.
Investors
Chilean startups can access funding from both public and private sources. On the public
side, Production Development Corporation (CORFO), founded in 1939, aims to promote
economic development in Chile. For every $1 funds invested, the CORFO can match an
additional US$2 or US$3 with low interest debt. CORFO also sponsors Chilean
incubators up to US$310k in grants for operations each year. There are 18 incubators
listed on CORFO’s site in 2016.
Start-upChile, launched in 2010, is an accelerator with 2 mandates: to elevate Chile’s
international profile and to build out a local culture of entrepreneurism. It offers up to
CL$50 million (80K USD) in equity free funding across its programs & over 100K of perks
as a participant and has attracted technology entrepreneurs from all over the world. As of
October 2018, Start-Up Chile has worked with over 1,300 startups, 51% of which are still
active.
The government also gives one-year visas to those who want to continue developing their
startups in Chile.
There are over 30 investment management firms administration VC&PE funds in 2016.
There are 36 angel investors in Chile Global Ventures FCH, Chile’s angel investor
network.
Investments in FinTech is mainly in the early stage with 75% of the startups received
investments of less than US$500k.
Talent
Tech talents are highly sought after in Chile but there is a shortage of talents.
Scholarships are granted by institutions such as Corfo and Conicyt to improve the quality
of Chile’s human capital.
Chile introduced a new tech visa in 2017 to allow entrepreneurs, tech talent and investor
to acquire a visa in 15 days.
In 2017, Chile was ranked 5th in the world for tertiary enrollment– About 89% of high
school students successfully enroll in university in Chile. Chile has some of the best
universities in South America (ranked 3rd and 4th), and many courses are aimed toward
international students. Furthermore, 94% of computer science graduates in Chile land a
job within the year after graduation.
Key takeaways
VC/PE in the region
► 500 Startups
► Disruptech
► NoBounds Capital
► Scale Capital
► Start-Up Chile
► Y Combinator
• Chile’s regulators have recently moved to increase regulatory clarity for
FinTechs.
• Chilean FinTechs are driving financial inclusion and SME finance
Varun Mittal
Global Emerging Markets
FinTech lead
varun.mittal@sg.ey.com
Contact us
www.ey.com/sg/FinTechHub
FinTech Hub