In a speech to Innovate Finance 2018 on 19 March, Christopher Woolard, Executive Director of Strategy and Competition at the UK Financial Conduct Authority (FCA) talked about the demand from FinTech firms to operate internationally and the FCA working with partners from around the world to consider options for a global sandbox. He said that the potential of such a project is huge – from solving global problems like money laundering to reducing the regulatory burden of compliance. Currently there is no joint sandbox programme with other regulators for firms to participate in. Such a project represents new territory.
In February 2018, the FCA invited stakeholders to share their views on what a global sandbox could look like by way of a proposal. The responses – from regulators to start-ups, challengers to large firms, trade bodies to think tanks – have started to arrive.
Establishing a global sandbox is an immense undertaking. The FCA wants to work with and through international bodies where it can – the FCA is already working closely with IOSCO, for example. The model should allow room for experiment. There could be a range of sandbox tests. For example, a single test in one country collecting data for multiple interested regulators or simultaneous testing in more than one country. The membership should be flexible. Most of all – the key to all of this is collaboration – this has to be a joint effort across international regulators, not a UK global sandbox.
Later this week the FCA will start work with interested regulators, including colleagues across Europe, the US and Far East, on a blueprint for a global sandbox