The Financial Conduct Authority is launching a permanent Digital Sandbox following two successful pilots to help support innovative business, start-ups and data providers from the 1st August 2023.
The Digital Sandbox is a testing environment that will provide businesses and innovators with support at the early stage of product development which saw more than half of the pilot scheme SME participants make positive developments in areas such as launching new products and funding.
The Sandbox will provide participants access to high-quality datasets, robust data security protection, a collaborative platform to share learnings and an observation deck to enable interested parties such as regulators to observe in-flight testing.
Industry players in sectors such as banking, investment, lending, payments, insurance, pensions and more will have access to this piece of testing equipment which will foster much needed innovation and growth within industries.
Dr Henry Balani, Global Head of Industry and Regulatory Affairs at Encompass Corporation commented: “The Digital Sandbox from the FCA represents a positive step when it comes to supporting innovation, and particularly for RegTech providers striving to deliver technology solutions that can bring significant business benefits.
“Crucially, this approach positively supports the development and testing of financial products in a safe, robust and non-market disruptive manner, where lessons can be learned. RegTech has an increasingly important role to play, with financial institutions looking to balance responding to an evolving and stringent regulatory landscape with maximising operations, which means facilitating the development of solutions that can support these institutions is vital.”