Today, the fintech industry wants the Reserve Bank of India (RBI) to make the proposed regulatory sandbox more inclusive and provide greater operational clarity for startups using the mechanism to help drive innovation in the payments landscape.
Flourish’s own Smita Aggarwal discussed the potential benefits of the proposed plan with the Economic Times below.
The RBI had, in April, released draft guidelines for stakeholder consultation based on the reports of the Household Finance Committee submitted in July 2017. A regulatory sandbox is a special testing environment where a company can sample new technology solutions on a limited consumer base, with customized regulatory leeway, under the purview of the regulators. Under the proposed model of the Reserve Bank of India, the testing would be done in ‘cohorts’ where a set of specific solutions would be first tested for a pre-set time-period.
Based on the results of the testing, the regulators would gauge the commercial viability of the product and possible regulatory tweaks that can be made to accommodate the solution.
“The process will improve regulators’ reach to common consumers as they would have a direct real-time access to the customer behaviour trends and other data points, which can gauge the applicability of the products being tested,” said Smita Aggarwal, a member of the Household Finance Committee. “This may lead to consumers who are underbanked finding more voice in policy interventions.”
Read the full article from Economic Times here.