Following our previous update on the Regulatory Sandbox in May, the FCA has announced the 24 businesses that will begin testing imminently.
Of 69 applications, 24 made the cut for this cohort and are permitted to test innovative ideas in a ‘safe space’ that is both a live environment, but still protects consumers.
The list of firms includes everything from start-ups to large incumbents such as HSBC or Lloyds Banking Group and summarises each company's plan. The diverse cohort make-up includes:
- nine using blockchain or distributed ledgers, with one using smart contracts
- two offering e-money platforms
- an automated insurance claims process
- four businesses focused on savings and personal finance management
- three innovations to payments
- a system for automated personal or commercial identity authentication.
Christopher Woolard, executive director of strategy and competition at the FCA, said:
“It has been an intense process for both firms and ourselves and we are grateful for their cooperation and hard work in getting us all to this position. We look forward to these businesses bringing new products and services to market whilst we ensure that appropriate consumer protection safeguards are in place.”
Six of the original 69 applicants are already accepted for the next cohort – unless the FCA decides to expand the number of slots, competition is likely to be fierce for the 18 remaining spots up for grabs in the application window from 21 November 2016 to 19 January 2017. The “test design period for cohort two will take approximately 10 weeks and [the FCA] would expect all accepted firms to be ready to begin testing in May 2017”.
Firms looking to jump into the Sandbox in future cohorts should have a look at the Sandbox website, which provides the application form, instructions on how to apply – and, perhaps critically, lessons learnt from those running the gauntlet during the first cohort. Applicants should:
Project Innovate is all about supporting innovators (of any size) and reducing barriers to innovation where possible. The continuous development of the Sandbox is simply underscores the FCA’s commitment to innovation – good luck to the first cohort!