FCA unveils successful sandbox firms

"The FCA’s regulatory sandbox was a first for regulators worldwide and underlines our deep commitment to innovation and our willingness to think outside the usual regulatory parameters"

The regulatory sandbox aims to create a ‘safe space’ in which businesses can test innovative products, services, business models and delivery mechanisms in a live environment while ensuring that consumers are appropriately protected.

The first cohort of the regulatory sandbox closed to applications on 8 July 2016. The FCA received applications from 69 firms from a diverse range of sectors, geographies and sizes. 24 applications were deemed to meet the sandbox eligibility criteria and were accepted to develop towards testing, including early stage start-ups, challengers and incumbent firms.

More well known firms include Citizens Advice who are developing a semi-automated advice tool which allows advisers and clients to compare key features of available debt solutions, and HSBC who have developed an app with a finTech start-up to help customers better manage their finances.

Lloyds Banking Group is also developing an approach that aims to improve the experience for branch customers which is aligned with the online and over the phone experience.

In partnership with Aviva, Tradle - an app and web-based service that creates personal or commercial identity and verifiable documents on a distributed ledger - will provide a system for automated customer authentication.

Govcoin Limited has partnered with DWP to determine the feasibility of making emergency payments using means other than cash or the Faster Payments Scheme. The payments platform will use blockchain to allow the DWP to credit value to a mobile device to transfer the value directly to a third party.

Online platform and app Bud will allow users to manage their financial products, with personalised insights, on a single dashboard.

Issufy, a web-based software platform, aims to streamline the overall IPO distribution process for investors, issuing companies and their advisors.

Nextday Property Limited will provide an interest free loan for a guaranteed amount to customers if they are unable to sell their property within 90 days.

Additionally, a number of firms are launching platforms which facilitate the transfer of payments, funds and shares using blockchain technology.

The current cohort will begin testing shortly on a short-term and small-scale basis. In addition, six firms were not ready to begin testing and will be part of cohort two.

Christopher Woolard, executive director of strategy and competition at the FCA, said: “The FCA’s regulatory sandbox was a first for regulators worldwide and underlines our deep commitment to innovation and our willingness to think outside the usual regulatory parameters. We are pleased to announce the first cohort of firms.”

“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.”