A new report from the UNSGSA claims regulatory sandboxes are “neither necessary nor sufficient to promote financial inclusion, and similar results can be achieved through innovation offices and other tools.”
UNSGSA (United Nations Secretary-General’s Special Advocate for Inclusive Finance for Development) also emphasised in the report that FinTech is capable of dramatically increasing financial inclusion for the 1.7bn people, globally, that do not have a bank account.
Advice given by the report states that regulators looking to adopt RegTech tools should start small with one or two case studies. Once these are successful the regulator should look to build momentum, with building capacity internally essential for success.
Another essential for regulators is to have staff which are dedicated to new technologies.
MAS managing director Ravi Menon said, “The FinTech phenomenon offers great opportunity to make finance more purposeful. Harnessed well, it will help to make financial services more accessible, more affordable, and more focused on the customer’s needs. Realising this potential requires close and continuous collaboration between the private and public sector. MAS is delighted to support UNSGSA and CCAF in producing this report, share our experiences, and learn from fellow regulators.”
The Early Lessons on Regulatory Innovations to Enable Inclusive Fintech: Innovation Offices, Regulatory Sandboxes, and Regtech report was commissioned by Her Majesty Queen Màxima of the Netherlands. It was then produced by the University of Cambridge’s Centre for Alternative Finance (CCAF) and the FinTech Working Group of the UNSGSA with support from the Monetary Authority of Singapore (MAS).
Queen Màxima said, “This report comes at a key moment when fintech has given us an unprecedented opportunity to bring more people into the formal financial system,”. “While these innovative tools are exciting, countries need guidance on how to regulate them in a way that maximizes their potential and minimizes their risks.”
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