The FCA has opened its application process for firms wishing to join cohort 6 of its regulatory sandbox (“Sandbox”). The FCA will be accepting applications from now until 31 December 2019.
The Sandbox allows innovative businesses to test new products or services on a small scale and in a controlled environment with consumers. Since its launch in 2016, 131 firms have been accepted (out of a total of 375 applicants) and cohort 5 saw a record of 99 firms making applications. Key benefits of the Sandbox cited by firms currently in the Sandbox include:
- regulatory engagement;
- the opportunity to test products in a live environment;
- the ability to identify flaws and fine-tune their offerings early on in the process; and
- increased credibility with investors and customers.
Who should apply?
The Sandbox is open to authorised firms, unauthorised firms that are seeking authorisation and technology businesses aiming to deliver innovation to the UK financial services market.
The FCA is particularly interested in firms with propositions that:
- address issues around access, exclusion and vulnerability;
- support the UK’s move to a greener economy and respond to climate change challenges; and
- use technology to help regulated firms comply with their regulatory obligations.
In addition, the FCA welcomes applications from firms using the following technologies:
- federated learning and travelling algorithms; and
- complex scenario modelling and simulation.
In order to satisfy the FCA’s eligibility criteria, the firm must show the following about the relevant product/ service:
- it is in scope;
- delivers genuine innovation;
- ·offers benefits to consumers;
- has a genuine need to be part of the Sandbox; and
- is ready for testing.
More information on how to apply and the eligibility criteria, including positive and negative indicators, can be found here.
How to apply
To apply for cohort 6, the application form must be completed and sent to email@example.com. Members wishing to apply can contact the FCA to discuss the process before applying by email or by telephoning 020 7066 4488.
The opening of cohort 6 of the Sandbox reinforces the continued focus and development of FinTech in the UK. We look forward to seeing what innovative products and services are going to be introduced as part of this cohort.