FCA has issued a set of default standards for sandbox testing parameters and a set of criteria against which sandbox eligibility can be determined by FCA (see FReD 13 November 2015 for more detail on the sandbox itself). The default standards cover duration, number of customers, customer selection and safeguards, disclosure, data and testing plans. The eligibility criteria include whether the firm is in scope, whether it is a genuine innovation, whether there is a consumer benefit, whether there is a need for a sandbox and whether the firm is ready for testing. In addition, FCA Director of Strategy and Competition, Christopher Woolard, spoke to the Innovate Finance Global Summit about FCA’s approach to the sandbox, in particular how to address two key challenges:
- how to deliver a sandbox that lowers barriers to testing within the existing regulatory framework; and
- how to ensure that risks from testing novel solutions are not transferred from firms to consumers.
He emphasises that FCA’s efforts in developing the first programme of this kind show the regulator’s commitment to innovation. (Source: FCA default standards for sandbox testing, FCA sandbox eligibility criteria and Woolard sandbox speech)