On 31 January 2019, the Global Financial Innovation Network (GFIN) was formally launched by an international group of financial regulators and related organisations committed to supporting financial innovation in the interests of consumers. At the same time, a number of these organisations agreed to open applications for firms interested in joining a pilot cohort for cross-border testing.
Building on a proposal by the Financial Conduct Authority in February 2018 to create a global sandbox, the GFIN was first proposed in a consultation paper in August 2018. Feedback to this consultation paper appears to have been overwhelmingly positive in favour of establishing the GFIN to facilitate a new practical method of regulatory collaboration on innovation and creating an environment for cross-border testing.
Positive feedback to the consultation is also reflected in the expansion of the GFIN network from 12 founding members to 29 organisations.
This expanded membership includes financial regulators from Australia, Bahrain, Bermuda, Canada, Curaçao and Sint Maarten, Guernsey, Hong Kong, Hungary, Isle of Man, Israel, Jersey, Kazakhstan, Kenya, Lithuania, Singapore, South Africa, Swaziland, the UAE, the UK and the US. Observer organisations include the Qianhai Financial Authority in China, the Consultative Group to Assist the Poor, the International Monetary Fund and the World Bank Group.
While the group remains open to new members, some interested parties may be disappointed there is still no involvement from a number of important regulators in the US, China, Japan, EU27 Member States or the EU.
The GFIN has finalised its terms of reference for governance and membership.
The three principal functions of the GFIN are to:
- act as a network of regulators to collaborate and share experience of innovation, including emerging technologies and business models, and to provide accessible regulatory contact information for firms
- provide a forum for joint RegTech work and collaborative knowledge sharing/lessons learned, and
- provide firms with an environment in which to trial cross-border solutions.
Pilot for cross-border testing
To support the development of international solutions, the GFIN has opened a one-month application window for firms interested in joining a pilot cohort for cross-border testing. The application deadline is 28 February 2019 and the pilot is expected to run for a six-month period from the second quarter of 2019.
Because GFIN cannot override national legislation, a separate application is required for each regulator that firms would like to test with. GFIN members will then coordinate with each other about the application. A list of participating regulators and links to their websites can be found here.
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