FCA cuts red tape binding innovation
The Financial Conduct Authority (FCA) is taking the shackles off innovation this spring by allowing financial services organisations test new technology with reduced regulatory commitments.
It is developing a Regulatory Sandbox to ease the process of getting new ideas to market.
The FCA said, ‘This spring we plan to expand our successful Project Innovate to open a Regulatory Sandbox. This will give firms which meet our eligibility criteria a safe space to test innovation without immediately having to meet all the normal regulatory requirements.
‘We want more firms to embrace innovation. One of our recommendations is for industry to consider setting up a not-for-profit company to act as a sandbox ‘umbrella’, and we look forward to their response. In the meantime, we hope our sandbox will speed up the time it takes for new and innovative products to reach market and start benefitting consumers.’
Tracey McDermott, FCA acting CEO, added, ‘The impact of technology is one of the fastest-evolving of this year’s priority themes, in particular, the potential of technology to improve not only how products and services are designed, but also how they are distributed.
‘This year we will foster new ways to help firms of all sizes develop novel ideas for market through our ‘Regulatory Sandbox’, which offers firms a safe space to test innovation, reducing the regulatory burden whilst achieving greater compliance.’
The FCA believes the Sandbox will ‘accelerate the development and testing of genuinely novel products which benefit consumers and provide a leading example to regulators in other countries. We expect more firms to come to market as a result.’