Daily Current Affairs Quiz 2019<\/a><\/strong><\/p>\n\n\n\nThe regulators may or may not permit certain regulatory\nrelaxations for the limited purpose of testing, the RBI framework says.\nEssentially, if a fintech company\u2019s business model requires interface with a\ncore banking system for example, a real-time and scaleable model of it will be made\navailable to the testing teams.<\/p>\n\n\n\n
This will be done for them to simulate whether the data flow\nand transaction flow follows the regulatory guidelines. All this in a secure\nenvironment.<\/p>\n\n\n\n
The move by the RBI had received a largely positive response\nfrom most financial technology (fintech) firms, which welcomed the chance to be\nable to test their products in the initial stages or before launch. Another\nissue with the proposed guidelines was, however, the limitation of allowing\ntesting to 10-12 selected entities at a time. The final version has not\nspecified the number of entities that will be allowed testing at a time.<\/p>\n\n\n\n
\u201cThe focus of the RS (regulatory sandbox) would be narrow in\nterms of areas of innovation, and limited in terms of intake. The RS shall\nbegin the testing process with a few select entities through a comprehensive\nselection process as detailed in the framework under \u2018Fit and Proper\u2019 criteria\nfor selection of participants in RS. The decision of the RBI on the application\nshall be final,\u201d the final framework document said. The size of groups that\nwill be allowed to use the regulatory sandbox and the window for submission of\napplications will be announced later, RBI said.<\/p>\n\n\n\n
The guidelines, however, stuck to their earlier stance of\nkeeping cryptocurrency or crypto assets services, trading, investing or\nsettling in crypto assets and initial coin offerings,out of the regulatory\nsandbox.<\/p>\n\n\n\n
Last month, a government panel had recommended outright\nbanning of private cryptocurrencies in India, with imprisonment of upto 10\nyears for anyone dealing in them, and the RS framework seems to be continuing\non the same lines.<\/p>\n\n\n\n
Start-ups had, in April, raised concerns about the impact\nthis could have on testing of distributed ledger technology, which is\nconsidered the future of financial services and banking.<\/p>\n\n\n\n
The government committee had recommended that the technology\nbehind cryptocurrency \u2013 distributed ledger techonology (DLT) \u2013 whose most\ncommon application is block chain, can be of great benefit to India in several\nfinancial and non-financial areas. These include trade financing, lowering the\ncosts of KYC and improving access to credit.<\/p>\n\n\n\n
The regulatory sandbox framework also identifies\n\u201capplications under block chain technologies\u201d as innovative technology.<\/p>\n\n\n\n
Regulatory sandbox is usually seen as a positive across the\nworld.<\/p>\n\n\n\n
The disadvantages to this are the fact that innovators can\nlose some flexibility in testing their products as well as the fact that it can\nactually take some time to get complete authorisation to use a sandbox.<\/p>\n\n\n\n
Also, post testing, the innovators may still require\nregulatory approvals to launch the product.<\/p>\n","protected":false},"excerpt":{"rendered":"
Reserve Bank of India released the final \u2018enabling framework for regulatory sandbox,\u2019 taking into account inputs received after a consultation process that began in April. The framework will likely be a positive step for financial technology start-ups and companies looking to innovate in the fast changing and highly regulated sector. The regulatory sandbox allows live […]<\/p>\n","protected":false},"author":13,"featured_media":4800,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[45],"tags":[458,64],"offerexpiration":[],"class_list":["post-4799","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-current-affairs-articles","tag-regulatory-sandbox","tag-reserve-bank-of-india-current-affairs"],"_links":{"self":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/4799","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/users\/13"}],"replies":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/comments?post=4799"}],"version-history":[{"count":1,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/4799\/revisions"}],"predecessor-version":[{"id":4801,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/posts\/4799\/revisions\/4801"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/media\/4800"}],"wp:attachment":[{"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/media?parent=4799"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/categories?post=4799"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/tags?post=4799"},{"taxonomy":"offerexpiration","embeddable":true,"href":"https:\/\/www.gkseries.com\/blog\/wp-json\/wp\/v2\/offerexpiration?post=4799"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}