The FCA has opened application windows for two ‘sandbox’ services to support innovative firms tackling challenges caused by the coronavirus (Covid-19) pandemic.
Application windows for Cohort 7 of the Regulatory Sandbox and the pilot of a new Digital Sandbox initiative have opened today, with an emphasis on supporting products and solutions that will assist consumers and firms affected by the pandemic.
Three key areas – preventing fraud and scams, supporting the financial resilience of vulnerable consumers, and improving access to finance for small and medium sized enterprises – have been identified as particular areas of importance for the FCA.
Cohort 7 of the Regulatory Sandbox is open to authorised and unauthorised firms as well as technology businesses that are looking to deliver innovation in the UK financial services market. This will operate in the same way as previous cohorts, allowing businesses to test innovative propositions in the market, with real consumers.
The Digital Sandbox pilot – launched with the City of London Corporation – aims to support earlier stage innovation where products and solutions are still in development and not at the stage where they are ready to be tested with consumers or in a live production environment.
The pilot will evaluate the effect that offering certain assistance to innovative firms, such as access to synthetic data sets, has on enabling new ideas to get to market more quickly, as well as the associated benefits for regulators and incumbent firms. The lessons learned from the pilot will inform efforts to establish an ongoing Digital Sandbox.
FCA Director of Innovation Nick Cook said: ‘The FCA is a strong believer in the positive power of innovation. Today we are strengthening the range and scale of support we are providing to innovative firms to deal with the challenges raised by the pandemic.
‘Together, these services will allow us to support a wider spectrum of innovative firms, from early stage Proof of Concept development in the Digital Sandbox, to testing new products or services with consumers in the Regulatory Sandbox.
‘As a regulator we recognise the need to continually experiment and learn in order to stimulate innovation. We are excited to launch this new service and by the lessons it will provide for future iterations of the initiative’.