The Malta Financial Services Authority (MFSA) has officially launched its FinTech Regulatory Sandbox which will provide legal certainty to industry players, whilst ensuring effective investor protection, market integrity and financial soundness within the FinTech environment.
FinTech refers to any technologically-enabled financial innovation that could result in new business models, applications, processes or products with an associated material effect on financial markets and the provision of financial services.
This Regulatory Sandbox will serve as a regulatory environment, where FinTech operators may test their innovation for a specified period of time within the financial sectors, under certain prescribed conditions.
It is based on four key objectives namely innovation, sustainability, certainty and knowledge and there are three types of people who can apply for it; FinTech Service Providers, FinTech Suppliers, and other applicants who do not qualify under FinTech legislation.
Applicants will go through a pre-testing stage first to assess their innovation and later move on to the actual testing phase of the project which can last between 6 to 12 months.
The MFSA encourages all interested parties to visit the MFSA’s FinTech Regulatory Sandbox page for further information and to pose any queries to the following email; firstname.lastname@example.org
“Financial services start-ups and incumbents view the Sandbox as a much-needed tool to help in the adoption of innovative solutions within their entities in an orderly manner, whilst enabling them to offer value-added products and services for their customers,” Strategy, Policy and Innovation Chief Officer Michael Xuereb said.
It will also enable the MFSA to enhance its understanding of the ever-changing technological innovation, placing it as a forward-looking Authority that promotes further growth of the financial services in a sustainable manner.
MFSA CEO Joseph Cuschieri said that this is a milestone for the MFSA with regards to its strategic objectives under its FinTech strategy.
“It is a milestone towards creating a holistic long-term approach to catalyse innovation, growth and competition in the financial services market, complementing the Financial Assets Act, further positioning Malta as an international FinTech Hub and a global thought leader,” he explained.
Parliamentary Secretary for Financial Services and the Digital Economy Clayton Bartolo praised this move by the MFSA, saying that it is one of the authorities that are leading Malta towards achieving more success within the country, especially with regards to its economic model and finances.
“By collaborating with participants, the authority will have the opportunity to enhance its capacity in assessing the regulatory implications and gaps of such innovative solutions, and identify the appropriate response as necessary,” he said, adding that this will affirm Malta’s reputation as a forward-looking jurisdiction that is open to innovation.