The sandbox is a term familiar to many within the insurtech sector, as it means a place where Google parks your new website for a few months, just in case it is a link farm, or something slightly dodgy. The Sandbox is also a term for developing new online products, which is exactly what London entrepreneurs need to do, as the UK High Street rapidly declines and jobs are lost in hospitality, tourism, motor servicing and other sectors.
The Financial Conduct Authority (FCA) and the City of London Corporation will collaborate on the pilot of a ‘digital sandbox’ to support innovative firms tackling challenges caused by the coronavirus (Covid-19) pandemic. The strategic partnership will see both organisations work together to develop and launch a digital testing environment to provide innovative firms with access to high-quality data sets to allow for the testing and validation of technology solutions.
In its pilot stage, the digital sandbox will support large financial institutions and start-ups looking to play a key role in the recovery from coronavirus through supplying relevant data sets and expertise in the areas of detecting and preventing fraud and scams, supporting vulnerable customers, and improving access to finance for SMEs financially affected by the pandemic.
The launch of the pilot represents a further stage of the FCA’s longstanding commitment to encouraging and supporting innovation in financial services through Innovate, the Regulatory Sandbox and TechSprint programme.
Financial Conduct Authority Interim Chief Executive Christopher Woolard said:
‘Innovation is a powerful driver of effective competition and can help to accelerate the development of new solutions to emerging challenges.
‘Building on our existing work supporting innovation in the market, we are now helping to establish a platform to tackle the challenges that will face the financial services sector in the recovery from Covid-19. We look forward to working with the City of London on this important initiative.’
City of London Corporation Policy Chair Catherine McGuinness said:
‘The UK has long been a world leader in fintech, fuelled by our innovative spirit, our creative energy, and our regulatory approach. That has borne fruit during this difficult period, during which we’ve seen accelerated demand for digitisation.
‘As we look towards recovery, it’s therefore vital that we continue to support innovation, and this digital testing environment provides us with the opportunity to do just that.
‘The City of London Corporation is committed to working alongside the FCA to build the digital sandbox and ensuring that the financial services sector fulfils its potential as a vital part of our future economic success.’