The UK’s Financial Conduct Authority (FCA) is planning to create a global regulatory sandbox that will enable the fintech firms to conduct tests in different jurisdictions.
The creation of a global fintech sandbox will also allow regulators to work together to identify and resolve common cross-border regulatory problems through tests.
The current regulatory sandbox, launched in 2016, only allows firms to conduct tests in the UK.
It has already been used by 60 firms to test their innovation with real customers under live market and controlled conditions.
FCA stated that the domestic version succeeded in meeting its objectives providing larger access to finance for the firms and reducing associated operational costs and time.
It also allows the firms to assess the commercial feasibility of the products and to ensure appropriate consumer protection safeguards are developed for the products.
To launch the global sandbox, FCA has already undertaken multiple steps to develop international engagement and cooperation.
It has signed nine bilateral cooperation agreements with other jurisdictions to encourage dialogue between regulators.
FCA also noted that currently it does not provide the opportunity to the firms to participate in a joint sandbox programme.
The authority is now seeking opinion about the viability of the proposal from all interested parties.
It stated that the overall approach would be to assess and resolve common regulatory problems as well as assist firms with cross-border ambitions.