 "RBI, Reserve Bank of India")
The Reserve Bank of India (RBI) on Friday said five entities were selected for the test phase of the regulatory sandbox’s theme-neutral fifth cohort that it had announced in October last year.
The banking regulator received 22 applications for this cohort of the regulatory sandbox.
The selected entities include companies such as Connectingdot Consultancy, Epifi Technologies, Finagg Technologies, Indian Banks’ Digital Infrastructure Company (IBDIC), and Signzy Technologies.
These firms offer services such as categorisation of risks in loan portfolios, digital opening of accounts for Non-Resident Indians (NRIs) through video Know Your Customer (KYC), MSME financing, unassisted video KYC, among others.
A regulatory sandbox refers to live testing of new products or services in a controlled regulatory environment for which regulators may or may not permit certain relaxations for the limited purpose of testing.
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The different processes and stages involved in a regulatory sandbox include preliminary screening, the assessment of applications and shortlisting, formulation of test design and integration phase, and a testing and evaluation phase.
It enables the regulator, financial service providers, and customers to conduct field tests, and collect evidence on benefits and challenges of new financial innovations while monitoring and containing their risks.
The target applicants for entry to the regulatory sandbox include fintechs, banks, and companies partnering with or providing support to financial services businesses, among others.
The sandbox may run a few cohorts (end-to-end sandbox process), with a limited number of entities in each cohort testing their products during a stipulated period, according to the Enabling Framework for Regulatory Sandbox.
