The United Kingdom’s Financial Conduct Authority (FCA) has announced the launch of its Digital Sandbox, aimed at supporting tech firms in the early stages of product development.
In a July 20 announcement, the FCA said the Digital Sandbox will become available on a permanent basis starting on Aug. 1. The financial watchdog conducted two pilot programs of the initiative, which will be open to businesses, startups and data providers — including those involved in banking, investment, lending and payments.
A sandbox allows projects to operate in a testing environment to evaluate their products and services largely without unintended side effects impacting the real world. According to the FCA, the Digital Sandbox is aimed at helping innovative firms in their efforts to launch new products and services, as well as support economic growth and international competitiveness.
The U.K.’s Economic and Finance Ministry proposed a “financial market infrastructure sandbox” in April 2022 alongside its plans for a regulatory framework on payment stablecoins. HM Treasury has also opened up a consultation for a digital securities sandbox that could include crypto products in July.
On July 3, the European Commission announced 20 projects had been selected for a European Union regulatory sandbox. Those qualifying for the initiative included firms in finance and capital markets, telecoms and information technology and global trade.