Open finance's quiet killers: dirty data and consent fatigue in Latin America

For anyone tracking where Latin American capital flows next, the open finance story has always sounded like a gold rush: banks, insurers, and fintechs sharing data to hand out better loans, sharper rates, and personalized advice. But dig beneath the regulatory headlines and the real bottlenecks are far less glamorous. Two of them, according to executives building the plumbing for this ecosystem, are the unglamorous work of cleaning data and the delicate art of managing user consent. Without solving both, the region's fintech dream stays stuck in neutral.

Oscar Hernández, CEO of the consulting firm Bluetab Latam, puts it bluntly: different institutions cannot talk to each other unless they speak a uniform language, and that language depends on quality information. A payment labeled 'payment_01' is useless if no one knows whether it covers car insurance or a Netflix subscription. Hernández says the data needed to assess a loan applicant is often scattered, unconsolidated, and messy. In the worst cases, the same customer appears as three different people — 'Maria,' 'Maria Lopez,' and 'Maria L.' — because no one has standardized the records. Bluetab, which IBM acquired in 2021, helps financial institutions organize this chaos, turning raw information into decisions that actually generate value. Hernández frames it as converting industry knowledge into usable intelligence, but the process is painstaking, not magical.

The second underestimated hurdle is consent, and here the regional context matters. Mexico's Fintech Law, specifically Article 76, requires explicit customer approval before sharing transactional data like balances, transaction histories, and loan payments. That is the most sensitive layer of open finance, and it demands meticulous control over what is shared, for what purpose, and for how long. Natalia Landeta, CEO and co-founder of Certena, a Colombian startup, argues that data is moving so fast that regulation and consent will inevitably tighten. Her company builds platforms that let users see exactly what they are sharing and manage permissions across multiple institutions, including telecoms. She calls open banking a trust-based system, and trust means users must control their own data. But the average person remains wary of granting account access, especially when the benefit — a slightly better rate or tailored advice — is not clearly explained. If the value proposition is fuzzy, the customer simply says no.

What makes this particularly Latin American is the combination of a young regulatory framework and a consumer base that has learned to be skeptical of financial institutions. In Mexico, the Fintech Law is still relatively new, and implementation lags the ambition. In Colombia, where Landeta operates, the ecosystem is vibrant but fragmented. The result is that open finance risks becoming a promise that only works for the tech-savvy few, while the majority stays on the sidelines. That would defeat the entire purpose of democratizing credit and investment across a region where access to capital remains uneven.

For wealth watchers, the signal is clear: the winners in South America's fintech race will not be the flashiest apps but the quiet infrastructure players — the data cleaners, the consent managers, the middleware specialists. These are the firms that make open finance actually function, and they are attracting attention precisely because the macro challenges are well known while these micro ones are ignored. Investors who understand that dirty data and consent fatigue are the real moats will find opportunities others miss.

Looking ahead, the path forward is not about more regulation but about better execution. Hernández and Landeta both point to the same conclusion: open finance will only scale when users feel safe and institutions can trust their own information. That means investing in data governance and building consent tools that are not just legal checkboxes but living documents, updated as relationships evolve. For Latin America, where fintech adoption has surged in payments but lagged in lending and insurance, solving these two problems could unlock the next wave of growth. The region has the talent and the regulatory will; what it needs now is the unglamorous grind of making data speak one language and making users feel they hold the keys.