According to reports, Argentina’s Central Bank is working on a new set of legislation aimed at gaining control of all digital wallets in the country. This new legislative framework is aimed at preventing fraud, which is thought to be helped by these tools. The release of the bill, according to leaks in local media, is soon.
Argentina’s Central Bank Is Interested in Digital Wallets
Argentina’s Central Bank is interested in the adoption of digital wallets. The bank’s director is apparently developing a new set of laws to better comprehend what’s going on with the funds in these wallets and to improve their KYC requirements. In terms of how this will be accomplished, it was stated:
It is not about outlawing anything, but about implementing the same regulations that banks must follow today in terms of client knowledge.
The bank indicated that it is imposing these new restrictions because there is a high level of fraud associated with the use of these technologies, and some businesses fail to exercise due diligence when onboarding customers. Because not all wallets work the same way, the rules will have to be applied on a case-by-case basis, according to central bank officials. w Digital Wallet Regulations
The step will allow the bank to control the stream of users who are now operating digital wallets such as Mercado Pago, which is expected to be close to 30 million. Last year, the Central Bank of Argentina mandated that these companies keep 100 percent of their customers’ assets in their bank accounts, limiting their ability to benefit from investments made with a portion of these funds.
Confiscations are already taking place.
While the Central Bank is developing this new legal framework for digital wallets, the Argentine Tax Authority, the AFIP, has already begun to seize funds in taxpayers’ digital wallets who owe money. Almost 10,000 taxpayers’ digital wallets are expected to be confiscated in the coming months.
According to local media, the first occurrence of these seizures has already occurred, indicating that this plan is already in action. The AFIP reportedly demanded the first confiscation, and a judge granted the institution custody of the funds in the digital account in order to satisfy the user’s bills. The authorities first attempted to take the taxpayer’s bank accounts, but the outcome was negative.