The corporate regulator has released the details of its proposed regulatory ‘sandbox’ that would see fintech start-ups exempted from ASIC’s licensing requirements for six months.
ASIC has released Consultation Paper 260: Further measures to facilitate innovation in financial services which proposes to grant businesses “conditional, industry wide relief” from licensing conditions for six months.
The “regulatory sandbox exemption” will be limited to companies that provide financial advice about, or arrange for other persons to deal in, certain liquid products, according to ASIC.
Fintech start-ups that operate in the ‘sandbox’ testing environment will be required to comply with limits on the number of retail investors and their exposure to financial products.
Participating businesses will also have to maintain consumer protections, obtain ‘sponsorship’ from an ASIC-approved organisation, and notify the regulator before they commence testing.
“Businesses that do not meet the terms of the industry-wide relief will be able to apply for individual, tailored exemptions under our existing policies,” ASIC said.
The closing date for submissions from interested parties on the consultation paper is Friday 22 July.