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News: International Financial Services Centres Authority(IFSCA) has introduced a Framework for Regulatory Sandbox to tap into innovative FinTech solutions.
Facts:
- What is a Regulatory Sandbox? It is an infrastructure that helps financial technology (FinTech) players live test their products or solutions before getting the necessary regulatory approvals for a mass launch.
- IFSCA Regulatory Sandbox:
- Under this framework, eligible entities shall be granted facilities to experiment with innovative FinTech solutions in a live environment with a limited set of real customers for a limited time frame.
- These features shall be fortified with necessary safeguards for investor protection and risk mitigation.The Regulatory Sandbox shall operate within the IFSC located at GIFT City.
- Eligibility: All entities (regulated as well as unregulated) operating in the capital market, banking, insurance and pension sectors as well as individuals and startups from India and FATF compliant jurisdictions, shall be eligible for participation in the Regulatory Sandbox.
Additional Facts:
- Innovation Sandbox: It has also been proposed to be set up by IFSCA which will be a testing environment where FinTech firms can test their solutions in isolation from the live market, based on market related data made available by the Market Infrastructure Institutions(MIIs) operating in the IFSC.
- IFSCA: It was established to regulate the financial services market in the International Financial Services Centres set up under the Special Economic Zones Act, 2005.
