The Monetary Authority of Singapore (MAS) released a consultation paper discussing several FinTech regulatory guidelines that will enable financial institutions (FIs) as well as non-financial players to experiment with financial technology (FinTech).
Singapore is a key player and a hub for financial technology developments and startups, the country has a vibrant blockchain industry too, Ethereum-based solutions such as Digix and Otonomos are located in Singapore, and recently, it was visited by Ethereum’s inventor Vitalik Buterin as part of a blockbuster event to raise awareness of the great potential of decentralized trustless applications.
The Monetary Authority of Singapore is the central bank of Singapore. Their mission is to promote sustained non-inflationary economic growth, and a sound and progressive financial center. Singapore acknowledges and embraces FinTech, so that’s why they are going to push for the creation of a Regulatory Sandbox, to create a healthy ecosystem that enables and encourages innovation while protecting the consumers at the same time.
MAS believes that a regulatory sandbox approach (“Sandbox”) can be used to carve out a safe and conducive space to experiment with FinTech solutions, and where the consequences of failure can be contained. The Sandbox cannot remove all risks, as failure is an inherent characteristic of innovation. In this regard, the Sandbox aims to provide an environment where if an experiment fails, its impact on consumers and on financial stability will be limited.
The target audience of this Sandbox will be firms or institutions that are leveraging new or existing technology in an innovative way to provide financial products or services, or improve business processes, this the audience includes Financial institutions, technology firms, and entrepreneurs. With a Sandbox, FinTech solutions will see more relaxed regulations, which will bring innovation to the sector, MAS will provide assistance and support to the firms.
Jacqueline Loh, Deputy Managing Director of MAS, said:
MAS aims to provide a responsive and forward-looking regulatory approach that will enable promising FinTech innovations to develop and flourish. The sandbox will help reduce regulatory friction and provide a safer environment for FinTech experiments. We believe this will give innovations a better chance to take root.
All in all, this will increase the scope and support for FinTech firms in the country, better solutions and products will emerge if Blockchain startups can take advantage of this regulatory framework.
Image courtesy of Shutterstock
Apple users can now download the app of The Merkle in the App Store!
If you liked this article follow us on twitter @themerklenews and make sure to subscribe to our newsletter to receive the latest bitcoin and altcoin price analysis and the latest cryptocurrency news.