ECONOMYNEXT – Sri Lanka’s central bank has unveiled a regulatory sandbox to run innovative fintech experiments which can be released to the market after testing and gaining approval, Central Bank officials said.
“Any fintech company can make an application through a commercial bank or a financial institution,” Deputy Governor H A Karunaratne said.
“They can make the applications at any time.”
Applications would be approved or rejected within 15 days. The fintech company would then have nine months to experiment and perfect he product
“After the sandbox stage if they want to go the real environment they have to get regulatory approval,” Assistant Governor R A Jayalath said.
“They have nine months to develop and test it,
If the proposal is innovative we can accept it,”
The head of the central bank’s payments and settlements division D Kumaratunga said innovative proposals would be accepted.
“Then they have nine months to test it,” he said.
The central bank is keen to ensure security.
“The Applicants are required to identify and divulge any potential risks to financial institutions, customers and the financial systems stability of the country, from the proposed product or service including financial, legal, process, market, and operational risks,” a public notice on sandbox process sid.
The application for the regulatory sandbox could be downloaded in https://www.cbsl.gov.lk/en/public-notices.
The central bank has declared 2020 as the year of digital transactions, where it is encouraging financial institutions to promote non-paper money transactions, using debit cards and more cost-effective QR code based technology.
At least four banks have started QR code based payments separately. The central bank and LankaClear has developed a common QR code standard and the banks are in the process of moving to it.
The bank says digital transactions would benefit rural customers who live far from brick and mortar banks as well as small businesses. (Colombo/Mar11/2020)