Emilia Castro
The growth of fintech activities in Central America responds to financial needs shared across the region, such as more efficient payments, access to credit, remittances, business digitalization and financial inclusion. However, the region is not a single regulatory market. A fintech company or startup may run the same technology platform in several countries and still need different legal structures, partnerships, controls and contracts in each jurisdiction.
Regulatory fragmentation is not only a matter of some countries having more developed or more specific rules than others. It also reflects differences in how each jurisdiction defines reserved activities, the administration of funds, payment services, electronic money, virtual assets and supervision. As a result, regional expansion across the Central American isthmus requires first identifying which activities make up the business model and then determining which authorizations, registrations or partnerships each of them requires.
I- “Under construction” is not the same as “unregulated”
The absence of a law expressly called a “Fintech Law” in the countries of the region does not necessarily mean a legal vacuum. In practice, it is the activities that the company carries out which define or trigger a regulatory perimeter for its business. Receiving or administering funds, executing payments, issuing electronic money, granting credit with third-party funds or holding virtual assets in custody may require authorizations, registrations and supervision. By contrast, a B2B technology solution that does not administer funds may face different treatment, even though both companies describe themselves commercially as fintechs.
Operating without that analysis exposes the company not only to penalties or regulatory restrictions, but may also make it harder to open bank accounts, enter into partnerships with supervised entities, raise investment and expand into other jurisdictions. Regulatory compliance should therefore form part of the strategy and of product design, rather than being a review carried out after launch.
II- A regulatory map that is not moving at the same pace in every country
Recent regulatory developments illustrate that diversity. In Costa Rica, opinion PGR-C-196-2024 of the Office of the Attorney General defined how payment service providers affiliated with SINPE may operate, distinguishing payment services and the administration of funds from the opening and maintenance of checking or demand savings accounts, which are reserved activities. Based on that criterion, the Central Bank of Costa Rica amended the Payment System Regulations to enable Resource Administration Accounts (CAR), which may be offered by payment service providers affiliated with SINPE. In addition, the draft Fintech Framework Law, file No. 24.429, is still before the legislature. Finally, a legal reform in force as of September 2026 introduced a specific regulatory regime for virtual asset service providers (VASPs). We analyze that regime in more detail in our article on the regulation of virtual assets in Costa Rica.
In 2024, Honduras updated its regulation of payment and transfer services using electronic money through Resolution No. 01/2024 of the Central Bank of Honduras. Nicaragua, for its part, updated in 2025 its specific regime for payment service providers and virtual asset service providers, covering payments, electronic money, acquiring, payment instruments, and the exchange and custody of virtual assets. In El Salvador, the 2025 reform of the Bitcoin Law kept Bitcoin as legal tender but made its acceptance voluntary in the private sector. Guatemala, on the other hand, continues to develop sector-specific security rules for the electronic channels of financial institutions and recently approved the Anti-Money Laundering Law, effective as of September 17, 2026, which will have a significant impact on various sectors of the economy, including fintech activity.
These changes show that the region is not moving toward a single regulatory model. Each country is defining its own regulatory perimeter according to its institutional priorities, the risks it seeks to address and the level of development of its financial system.
III- Regulatory challenges of operating a fintech in Central America
- Defining the regulatory perimeter correctly: The first decision is to break the business model down into specific activities: technology, payments, custody, credit, remittances, virtual assets or the distribution of financial products. That analysis makes it possible to determine which part of the model can operate freely, which part requires authorization and which part is better structured through a regulated entity.
- Regulatory disparity between countries: Regulatory fragmentation is a challenge for companies in the sector seeking to expand regionally, because it affects who contracts with the user, who receives or holds the funds, who performs KYC, where data is processed and who is liable to the consumer. A strategy that works in Costa Rica may not meet Nicaragua’s regulatory requirements, nor can it be automatically transferred to Honduras or El Salvador.
- Choosing between a proprietary license, a partnership or outsourcing: In some models, expansion can rely on a bank, an issuer, a payment provider or another authorized entity. Such partnerships can accelerate market access, but they require contracts that define roles, liability toward the user, compliance, operational continuity and data handling. Outsourcing may transfer execution, but not necessarily liability.
IV- Regulatory harmonization in the region: convergence of principles, not absolute uniformity
Full regional harmonization is unlikely in the short term. Progress toward shared principles is possible, however: risk-proportionate regulation, technological neutrality, consumer protection, safeguarding of funds, anti-money laundering, cybersecurity and responsible data handling. The idea is to start from internationally recognized regulatory objectives and experiences, which each jurisdiction decides how to adopt and implement according to its own context.
For fintech companies, that convergence would allow a common architecture for governance, technology, compliance and contracts, possibly complemented by local modules for each jurisdiction. Until there is regional recognition of licenses, the best strategy will be to maintain a regional vision and local execution.
V- Recommendations for operating a fintech in Central America
Central America’s regulatory disparity poses significant challenges for fintech companies seeking to operate in the region. Greater harmonization could provide legal certainty and facilitate regional expansion, although it would not remove these challenges entirely. Given this reality, a fintech company planning to operate or expand in Central America should:
- Identify activities and fund flows: Assess the business model to identify the activities that make it up and determine who receives, holds, transfers or uses the funds at each stage.
- Define the regulatory structure country by country: Determine whether a license, a registration, a local company or a partnership with an authorized entity is required, or a combination of these.
- Design scalable compliance: Build in AML/KYC measures, consumer protection, privacy and cybersecurity from the outset, with a risk-proportionate approach.
- Regionalize contracts and technology: Use a common base, but adapt terms, features, operational limits and data handling to each jurisdiction.
- Monitor regulatory developments: Keep track of legal and regulatory changes that may affect operations, in order to anticipate risks and adjust the compliance strategy.
- Maintain relationships with regulators and industry associations: Regulatory monitoring and ongoing dialogue with the main players in the ecosystem help companies stay informed about regulatory trends, draft legislation and relevant initiatives, which in turn makes it possible to anticipate change and reduce adaptation costs.
Central America offers common opportunities, but it calls for differentiated legal responses. Scaling a business in the region, particularly a fintech business, is not simply a matter of replicating one model in each country: it means designing a regional architecture — corporate, contractual, operational and compliance-related — that preserves regional coherence and can be executed properly in each market. Coordinated regional counsel turns regulatory fragmentation into a design variable rather than a cost of correction.