MAS Moots «Sandbox Express» to Spur Innovation
The Monetary Authority of Singapore is consulting the public for a «Sandbox Express», a regulatory environment which further supports experimentation and innovation.
Based on some feedback that Singapore's regulatory sandbox is hard to access, the Monetary Authority of Singapore (MAS) has decided to speed up regulatory decisions by launching a public consultation for creating a «Sandbox Express».
«It will make it easier to get into the Sandbox. 21 days – that will be our target. This will be for activities where the risks are low or well understood. We can relax the system and allow tests and experiments to happen more quickly,» said Ong Ye Kung, board member of MAS in his speech at the Singapore FinTech festival.
Start First
A regulatory sandbox is an environment where regulations are suspended, and allows firms to test their ideas with real customers in a fixed period of time. Currently, the process for fintech startups seeking entry into this protected environment can take months.
During those months, applications are withdrawn due to the fluid and volatile nature of startup businesses, while other startups realise that there is no need for their ideas to be tested in the sandbox after having informal talks with MAS officials.
However, if a new idea comes along, Ong urges entrepreneurs to «start first». After that, the regulator will observe how it can optimise regulation.
Not A Laissez Faire Regime
However, Ong explains that MAS is not adopting a regulation-free approach because it is concerned that certain players or systems can grow too fast, bypassing entire financial systems and traditional financial services, posing prudential concerns.
«They are close loop systems that do not encourage inter-operability and overtime, stifles competition,» said Ong. In contrast, Singapore's ePayment system was designed to have open architecture, so even non-banks can access it.
