The Monetary Authority of Singapore, has released a consultation paper on proposed guidelines for a «regulatory sandbox» that will enable to experiment with financial technology solutions.
The thinking behind the so called «regulatory sandbox» will enable Financial Institutions (FIs) or any interested firms, to experiment with innovative Fintech solutions in an environment where actual products or services are provided to the customers but within a well-defined space and duration. For the duration of the regulatory sandbox, MAS will relax specific regulatory requirements which an applicant would otherwise be subject to.
Due Diligence Puzzle
The Monetary Authority of Singapore (MAS) realising that the Fintech landscape is fast evolving, with a proliferation of technological innovations and solutions, wants to encourage FIs to test and introduce these innovations if they are relevant, allowing them to do their own due diligence.
However, MAS recognises that there may be circumstances where it is less clear whether a particular Fintech solution complies with regulatory requirements or poses unacceptable risks. The uncertainty may stifle promising innovations, and may result in missed opportunities.
Experiments Welcome
«MAS aims to provide a responsive and forward-looking regulatory approach that will enable promising Fintech innovations to develop and flourish. The sandbox will help reduce regulatory friction and provide a safer environment for Fintech experiments. We believe this will give innovations a better chance to take root,» said Jacqueline Loh, Deputy Managing Director of MAS
The public consultation will be open from 6 June 2016 to 8 July 2016.
