FCA 'sandbox' helps test the waters of fintech revolution

Added 15th June 2017

New face recognition and blockchain technology built by financial firms is due to be tested in the coming months as part of the FCA’s second regulatory sandbox.

FCA 'sandbox' helps test the waters of fintech revolution

Of the 77 applications made to the regulator to be a part of the second cohort, 31 were approved and 24 firms are now ready to begin testing their products, the FCA confirmed.

The sandbox offers businesses time, space and funding to test new products as part of the FCA’s Innovate project launched in 2014 to promote greater competition in markets.

Businesses such as Saffe, which wants to develop facial recognition for authorising payments, and Nuggets, a consumer blockchain application for logging into systems without storing personal data, are among the sandbox’s latest cohort.

Christopher Woolard, executive director of strategy and competition at the FCA, said: “The sandbox continues to grow in popularity and it is particularly encouraging that both the number of firms applying and accepted for testing has increased in cohort two.

“That means more innovative firms, trialling more innovative propositions to bring to the market.”

He added it was part of the regulator's attempts to promote innovation and competition in the market.  

Firms such as Asset Vault will test a new way for consumers to catalogue all of their assets online to better understand their total value and be provided more suitable insurance providers.

While Nivaura will focus on automating the primary issuance and administration of financial assets using blockchain technology.

With the second round of testing due to begin, applications for the third cohort are now open.

Firms of all sizes have until 31 July 2017 to submit their applications and would need to be ready to begin testing for six months from November onwards.

A full list of requirements and further details are available online.

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Louise Hill

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Louise joined Portfolio Adviser in December 2016 as one of the editorial team’s news reporters based in London. Originally from Liverpool, she is an NCTJ-qualified journalist and began her career in 2014 working on local newspapers.

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