Regulatory Sandboxes boost Fintech Funding
Fintech promises to revolutionise the financial sector, with efficiency, choice, and financial inclusion on the horizon. However, disruptive growth in finance needs to be supervised and regulated so risks are properly managed. That’s where regulatory sandboxes come in – they allow start-ups to trial innovations under the watchful eye of authorities.
This week, a Bank of International Settlements (BIS) paper takes a look at regulatory sandboxes, which have been in action around the world for about 5 years now. The paper assesses the UK’s regulatory sandbox, finding that entering into it increased the probability of a fintech firm raising funding – largely by reducing asymmetric information and regulatory costs.
Read the paper here.
