What is meant by regulatory sandbox? While the draft guidelines on it are indeed a logical step forward, clarity on some of the aspects outlined above is needed. Elaborate (200 Words)
Refer - Financial Express
Enrich the answer from other sources, if the question demands.
IAS Parliament 5 years
KEY POINTS
· Regulatory sandbox refers to live-testing of new products and services in a controlled environment with active cooperation of the supervisor.
· This allows companies to experiment with their products and improve their viability in the existing market.
· From the regulator’s perspective, the sandbox allows it to gain insights into potential risks and benefits arising out of innovative products and business models, and facilitate innovation.
· RBI, in its draft guidelines, has listed the eligibility criteria for participating in the sandbox.
· It has listed certain innovative products, services and technologies that could be tested in the sandbox. It has also listed what may be excluded from the sandbox.
· It has also spelled out the criteria for selection of participants in the sandbox.
· The Indian approach spelt out in the draft guidelines, is silent on Licence aspect, obtained for regulatory sandbox.
· Ambiguity in joining criteria.
Boundary conditions for the regulatory sandbox refer to the space and duration of the proposed financial services to be tested in the sandbox.
· The draft guidelines have specified the start and end date of the regulatory sandbox, target customer type, limit on the number of customers involved, the transaction ceiling and cash-holding limits, and cap on customer losses.
· The draft guidelines do not say anything about the evaluation criteria for sandboxes in India.
SARI 6 years
Please Review...............
IAS Parliament 5 years
Good answer. Keep Writing.
