Bank Ne­gara is­sues de­tails of fin­tech sand­box frame­work

The Sun (Malaysia) - - SPEAK UP -

PETAL­ING JAYA: Bank Ne­gara Malaysia (BNM) is­sued de­tails of the Fi­nan­cial Tech­nol­ogy Reg­u­la­tory Sand­box Frame­work yes­ter­day af­ter a one-month con­sul­ta­tion process.

“The reg­u­la­tory sand­box will en­able the ex­per­i­men­ta­tion of fin­tech so­lu­tions in a live en­vi­ron­ment, sub­ject to ap­pro­pri­ate safe­guards and reg­u­la­tory re­quire­ments,” it said in a statement yes­ter­day.

The frame­work is now in ef­fect and open for ap­pli­ca­tion.

BNM said it re­ceived over 60 com­ments and sug­ges­tions from var­i­ous stake­hold­ers in­clud­ing fi­nan­cial in­sti­tu­tions, fin­tech com­pa­nies, as­so­ci­a­tions and other cor­po­rates, and has ex­panded the el­i­gi­bil­ity cri­te­ria to clar­ify the fo­cus of in­no­va­tions that the sand­box aims to sup­port.

“In­no­va­tion should have clear po­ten­tial to im­prove the ac­ces­si­bil­ity, ef­fi­ciency, se­cu­rity and qual­ity of fi­nan­cial ser­vices; en­hance the ef­fi­ciency and ef­fec­tive­ness of Malaysian fi­nan­cial in­sti­tu­tions’ man­age­ment of risks; or ad­dress gaps in or open up new op­por­tu­ni­ties for fi­nanc­ing or in­vest­ments in the Malaysian econ­omy,” it added.

The cen­tral bank re­viewed the min­i­mum stan­dards and re­quire­ments for par­tic­i­pa­tion in the sand­box to en­cour­age wider par­tic­i­pa­tion of fin­tech com­pa­nies.

Ap­pli­cants to the sand­box are re­quired to demon­strate that a prod­uct, ser­vice or so­lu­tion has been developed to a func­tional stage and is ready for test­ing. The ap­pli­cant must have a good un­der­stand­ing of risks dur­ing test­ing, with ad­e­quate re­sources to ef­fec­tively man­age the risks.

Ap­pli­cants will be in­formed of their el­i­gi­bil­ity to par­tic­i­pate in the sand­box within 15 work­ing days of BNM re­ceiv­ing an ap­pli­ca­tion, fol­lowed by prepara­tory en­gage­ments be­tween BNM and the ap­pli­cant prior to test­ing.

“The frame­work re­flects BNM’s long-stand­ing pol­icy in strik­ing an op­ti­mal bal­ance be­tween pro­mot­ing in­no­va­tion whilst pre­serv­ing fi­nan­cial sta­bil­ity and pro­tect­ing con­sumer in­ter­est. Based on the level of queries and feed­back re­ceived dur­ing the con­sul­ta­tion pe­riod, BNM is en­cour­aged and looks for­ward to re­ceiv­ing ap­pli­ca­tions to test new ideas and de­ploy new so­lu­tions un­der the sand­box,” Fi­nan­cial Tech­nol­ogy En­abler Group chair­man Az­nan Ab­dul Aziz said.

The fi­nal­i­sa­tion of the frame­work aims to pro­vide an en­vi­ron­ment that is con­ducive for the de­ploy­ment of tech­nol­ogy to foster in­no­va­tions that can con­trib­ute to the growth and de­vel­op­ment of Malaysia’s fi­nan­cial sec­tor.

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