The Dubai Financial Services Authority is supporting Dubai's position as the region's leading hub for innovation through the publication of a new fintech consultation paper.
The paper is the third in a series, setting out the Dubai Financial Services Authority (DFSA's) approach to the regulation of pioneering financial technology activities.
The DFSA has been following developments in fintech and, in 2016, determined that the current regime for regulating firms in the Dubai International Financial Centre (DIFC) is already flexible enough to accommodate many aspects of fintech without introducing new rules.
The consultation sets out the DFSA's approach to fintech firms that want to test innovative products and services in the DIFC.
Licence Required
Firms meeting the qualifying criteria will receive a Financial Services Licence, referred to as an Innovation Testing Licence, which reflects the nature of the activities to be conducted during the testing phase.
The DFSA will put in place limits on the fintech testing activities to ensure appropriate controls for the safety of any customers involved. Given the limits on activities permitted during testing, fintech firms will not have to comply with DFSA Rules where they are inappropriate at a testing stage.
No Sandbox Yet
The testing phase is a step towards the fintech firm obtaining a full Financial Services Licence.
«The DFSA's approach to fintech has been to regulate where needed, in order to create an environment that encourages innovation in technology in its many forms and applications,» said Ian Johnston, Chief Executive at the DFSA.
