SECP introduces sandbox

ISLAMABAD: The Securities and Exchange Commission of Pakistan (SECP) has issued Regulatory Sandbox Guidelines 2019 to promote innovation in financial sector and encourage startups.

This would be Pakistan’s first regulatory sandbox in the financial services industry. Regulatory sandboxes are becoming increasingly popular regulatory tools internationally. As of now, more than 50 countries have introduced their respective regulatory sandboxes with similar objectives.

The guidelines are aimed at reducing regulatory obligations through allowing testing of new products, business models, and services in the regulatory sandbox. The sandbox will be available for all the regulated sectors of the SECP ie insurance, capital markets, non-banking financial services, and overall corporate sector.

The sandbox is a tailored regulatory environment for conducting limited scale, live tests of innovative products, services, processes, and/or business models in a controlled environment. Such tests will be conducted under close supervision of the regulator for a specific period so as to assess the viability and compatibility and regulatory environment conducive for innovative solutions.