How to lay the foundations of a competitive financial market in 10 steps

The document presents an executive summary and detailed proposal from Zetta and Labrys outlining ten steps to establish a competitive financial market, drawing on over a decade of experience in Latin America. The core argument is that while regulation is necessary for stability, post-crisis rules have often increased market entry costs, necessitating proactive government intervention to boost competition, particularly from fintech firms. These ten complementary actions are structured into three main categories: general regulatory considerations, such as being purpose-driven and embracing complexity; measures to remove market barriers, like adopting proportionate regulation and combating anti-competitive conduct; and positive actions to create competitive conditions, which include establishing frameworks for Open Finance and providing Digital Public Infrastructures (DPIs), like Brazil's Pix payment system. The authors stress that these measures, which also promote digital and financial inclusion, can be adopted separately but have a compounding effect when implemented together.