iGaming Regulations and KYC
Latin America is quickly becoming a fast-growing market for iGaming operators. According to reports, over 70% of iGaming operators plan to expand to Latin American and Central American markets in the next couple of years.
The iGaming market in Latin America is highly diverse and entertaining and it has been growing in recent years. One of the biggest factors behind this is the growing availability and affordability of high-speed internet smartphones. Another driving force is the increasing love for online gaming in Central and South America.
As Latin America represents a complicated map of jurisdictions with 34 countries and union territories, regulation has been a problem. But recently, there has been a positive shift in the regulatory space as well.
To help out both the iGaming operators and the players, we’ve created this guide for iGaming regulations and KYC in Latin America.
iGaming Regulations in Argentina
In Argentina, the gambling regulation is controlled by the country’s 23 independent provinces and the autonomous city of Buenos Aires. Several provinces in Argentina and Buenos Aires have legalized online gambling.
The authority that acts as a watchdog for AML regulations is the Congreso de la Nacion Argentina. It keeps an eye out for all the operators to see which ones aren’t following the regulations.
The regulatory landscape and the licensing regulation vary from province to province. All the operators have to screen players to prevent money laundering and make sure that gaming transactions go through state-owned banks.
iGaming Regulations in Brazil
With a population of over 200 million and a huge fan following for all things sports, Brazil has a quickly growing gambling market. Unfortunately, there’s no regulatory framework right now. Without a regulatory framework, it will be next to impossible for the iGaming industry to thrive.
Brazil has a history of high taxes, and if sports betting is subject to similarly high rates of taxation, it could discourage the investment in the market.
iGaming Regulations in Chile
The future of regulated iGaming in Chile is currently unclear as it attempts to both regulate and prohibit offshore online gambling companies. There’s a land-based gaming industry that’s riddled with lawsuits because of grey market operators.
If there ends up being a regulatory framework in Chile, the platform will be directly under Superintendencia de Casinos de Juego (SCJ) and operators will have to maintain strict security standards.
iGaming Regulations in Colombia
Colombia was the first Latin American country to regulate online gambling. All types of iGaming are allowed and regulated in Colombia, including, casinos, bingo, poker, and sports betting.
Colombia’s national regulator, Coljuegos has built a strong regulatory framework that ensures operators follow all the rules. Coljuegos also allows operators to apply for licenses and submit reports digitally, making the entire process fairly seamless.
This entire framework has led to reliable data and regular reports on the performance of the industry.
iGaming Regulations in Mexico
Mexico is one of the most popular markets for iGaming operators. 95% of the online casino operators are looking to expand to Mexico in the span of the next 5 years.
Mexico has a population of over 120 million and a mobile penetration rate of about 60%. This makes Mexico one of the largest iGaming markets in Latin America.
All the land-based casinos in Mexico are completely regulated. However, the online gaming market is in the grey area of regulations. Online casinos and sports betting operators don’t require digital licenses. They operate in partnership with a land-based license-holder casino.
iGaming KYC Compliance in Latin America
The requirement for financial transfers and the risk of fraud is always a factor of concern for the iGaming industry. To successfully manage fraud, the iGaming industry needs to have proper regulations.
Local compliance is continuously acting as a key barrier in Latin American markets. Businesses are also aware that they are likely to incur additional scrutiny in Latin American markets.
Newly regulated markets attract both wanted and unwanted attention. As iGaming markets open up, it’s more than likely that national regulators will implement strict rules on KYC and ID verification.
iGaming operators will need to adapt to these regulations and implement sophisticated measures to ensure compliance and build customer trust.
FAQs
Know your customer (KYC) is a requirement for regulated industries. In KYC, businesses have to verify the identity of customers before onboarding them. Businesses must carry out continuous monitoring to ensure customers are legit and they don’t pose a threat to the business.
KYC checks include data, documents, biometrics, and PEPs sanctions list checks. Each business uses a different method of verification. Some businesses combine verification methods to enhance due diligence.
