UK regulator plays sheriff to fight “Wild West” sandboxes
As fintech regulators across the world begin to set up their own sandboxes, with different models and standards, the UK’s Financial Conduct Authority says a “Wild West” version could emerge.
But hang on folks, we got a new sheriff in town. Speaking at the Innovate Finance Global Summit in London, Christopher Woolard, executive director of strategy and competition at the FCA, called for “stronger international co-operation” to combat this threat.
The idea from Woolard (and his posse) is to build a “common understanding of the principles of good innovation”. There weren’t a lot of specifics or timelines, but he did say in the last few months the FCA has signed co-operation agreements with China, Japan, Canada and Hong Kong. Last week, Woolard was in India discussing its next agreement.
The FCA’s plan is to develop a consensus through bodies like the G20 and International Organisation of Securities Commissions (IOSCO).
Woolard adds that it sees “potential risks to the reputation of and trust in financial innovation if there are examples of global failures in the future”.
Life outside London
Elsewhere in his speech, he made the usual pleasant remarks about the success of its Project Innovate – which aims to boost competition and growth in financial services; and its regulatory sandbox – the “first of its kind”.
Brexit also got a mention. Woolard says: “In the immediate aftermath of the EU referendum there was a concern that we would see the number of innovative firms wanting to operate in the UK fall.
“Indeed we did see a dip and it’s worth reflecting on the fact that we live in an uncertain climate and nothing can be taken for granted.”
In the nine months prior to the referendum, the FCA received 264 requests for support. But in the nine months after, that figure had increased to 321 requests for support.
He also made reference to the “emergence of serious interest in fintech hubs outside of London” – such as “developments from big data in Liverpool to robotics in Bristol”.
The FCA plans to “work with as many organisations in as many locations” as it can.
It seems the FCA is interested in everything and everywhere in our fintech world. It might need to recruit more staff or work longer hours.