The objective of the regulatory sandbox is to foster responsible innovation in financial services, promote efficiency and bring benefits to consumers.
The Reserve Bank received 25 applications, of which five have been selected for the Test Phase.
The Reserve Bank of India has selected five entities, including Indian Banks’ Digital Infrastructure Company and Signzy Technologies, to test products they have offered under the regulatory sandbox scheme.
Connectingdot Consultancy, Epifi Technologies and Finagg Technologies are the other entities that will commence testing their solutions from August 2024, the RBI said in a statement.
RBI received 25 applications, of which five have been selected for the Test Phase.
What Is RBI Regulatory Sandbox?
Regulatory sandbox usually refers to live testing of new products or services in a controlled/test regulatory environment for which regulators may (or may not) permit certain relaxations for the limited purpose of the testing.
About 5 Entities
The solution of Connectingdot Consultancy aims to provide high accuracy in predicting loan defaults by segregating the loan portfolios into high, medium and low-risk categories.
Epifi Technologies’ solution allows the digital opening of NRE/NRO accounts through video KYC and identity validations, thus enabling a seamless account opening experience for NRIs.
The solution being proposed by Finagg Technologies is a blockchain-based deep-tier vendor financing solution that enables financing for MSMEs, which are part of the procurement supply chain of large enterprises commonly referred to as anchors.
Indian Banks’ Digital Infrastructure Company (IBDIC) has offered a solution to make easy and affordable credit accessible to lower-tier/ small MSMEs.
The solution of Signzy Technologies offers an unassisted video KYC solution that allows users to complete video KYC steps independently without the involvement of officials of regulated entities.
Benefits of Regulatory Sandbox
The regulatory sandbox allows the regulator, innovators, financial service providers and customers to conduct field tests to collect evidence on the benefits and risks of new financial.
The objective of the regulatory sandbox is to foster responsible innovation in financial services, promote efficiency and bring benefits to consumers.
As per the RBI, the first and foremost benefit of the regulatory sandbox is that it fosters ‘learning by doing’ on all sides. Among other benefits, the regulatory sandbox could lead to better outcomes for consumers through an increased range of products and services, reduced costs and improved access to financial services.
(With PTI inputs)
