Following consultation with relevant stakeholders on the general aspects of the MFSA’s FinTech Strategy, the MFSA will be now providing further detail, and seeking feedback with respect to each of the six pillars identified within the Strategy, starting with the first pillar - Regulations.
With the publication of the Consultation Document on the first pillar of the Strategy, the Authority is seeking feedback with respect to the two proposed initiatives being (i) the MFSA Regulatory Sandbox and (ii) proposals in relation to RegTech and SupTech. The document also provides a status update on the other strategic objectives presented under this Pillar.
The MFSA is now seeking to encourage new and innovative business models by setting up a Regulatory Sandbox, which will also facilitate Malta’s effort to become a jurisdiction of choice in financial services. This concept gives participants the opportunity to test the commercial and regulatory viability of their innovations for a specified period of time in a fully functional financial services environment with real consumers, under a set of conditions and limitations, in order to contain the associated risks.
The Consultation Document identifies the various proposals under MFSA Regulatory Sandbox Framework, including how the Sandbox will operate in practice, the eligibility criteria, the participation structure, consumer protection measures and the various powers available to the Authority under this framework.
Meanwhile, the MFSA is also proposing to set up a framework for the regulatory certification of RegTech solutions, while also encouraging persons developing SupTech solutions to approach the Authority through a dedicated online form.
MFSA’s Chief Officer Strategy, Policy and Innovation, Dr Christopher P. Buttigieg explained that “this Consultation Document also looks into how the Authority will capitalise from the opportunities offered by technology to improve the regulatory and supervisory processes, with the aim of assisting authorised entities to comply more efficiently with regulatory requirements.”
The consultation is open to the public until 30 August 2019. Industry participants are invited to send their responses through an online survey (link) by not later than the said date. A workshop giving stakeholders the opportunity to discuss in further detail the first Pillar of the FinTech Strategy is being organised in collaboration with Finance Malta on 30 July 2019. Interested parties who would like to attend the event are invited to visit the MFSA FinTech webpage (link) for further details.
Note to reader: RegTech means Regulatory Technology which provides technologically advanced solutions to address regulatory challenges in the financial services industry. SupTech means Supervisory Technology which is the use of innovative technology by supervisory authorities to support regulatory supervision work.