Actualidad Colombia

Supporting online transactions

Draft bill 109/2018, Senate

Colombia's Congress has passed Bill 109/2018 to reduce the use of cash and encourage online transactions in a bid to promote transparency and the formal economy, while at the same time fighting against corruption.

This regulatory initiative is aligned with the international trend to reduce the use of cash and encourage online banking; in the case of Colombia, it hopes to combat the underground economy relating to activities such as drug trafficking and the informal economy, which lend themselves to tax evasion and irregular labor practices.

The measures to be rolled out include an assessment by the National Government of whether to reduce the number of high denomination banknotes in circulation; the requirement to conduct transactions of over EUR 27,600 online; promoting the use of online payment systems in public establishments and mass transit services; and creating incentives to legal persons promoting the use of online transactions.

In addition to acknowledging the National Government's responsibility for promoting financial literacy and getting people banked, the regulation enables the Executive branch to sign agreements with the public and private sectors, to guarantee that citizens are educated in financial literacy.

The Bill sets a deadline of 2030 for all Colombian institutions to have eliminated the use of cash.