The WFE responds to Global Financial Network (GFIN) Consultation

By: The WFE Regulatory Affairs Team Oct 2018

The WFE has responded to the Global Financial Innovation Network (GFIN) Consultation Document.

On 7 August 2018, the Financial Conduct Authority (FCA) announced the internationalisation of its regulatory sandbox via the GFIN - a collaboration with 11 financial regulators and related organisations. This builds on the FCA’s proposal earlier this year to create a ‘global sandbox’, a proposal that WFE responded to in March 2018 by welcoming the FCA’s initiative to consult the market on broadening the geographic reach of its existing regulatory sandbox, and by reiterating its support for a globally coherent approach to FinTech.

 The response by the WFE to the GFIN consultation can be summarised as follows:

  • The WFE supports the proposed GFIN Mission Statement and the three proposed functions: a network of regulators; joint policy work and regulatory trials; and cross-border trials.

  • The WFE applauds the GFIN’s objective of continuing to explore the idea of a ‘global sandbox', along with investigating ways in which regulators can work together to balance the benefits of innovation with existing policy objectives. 

  • Regulatory sandboxes and innovation hubs have proven to be a useful tool for the FinTech industry by allowing businesses to test the use of innovative products, services and applications, promoting responsible innovation without jeopardising investor protection.

  • The WFE welcomes the plan to extend the GFIN initiatives globally, to ensure that collaboration and exchange of information occurs between industry (whether regulated, or not) and regulator. 

  • The WFE advocates international guidelines and principles, to promote global consistency. This is particularly needed in the areas of Artificial Intelligence, Machine Learning, Digital Ledger Technology, Cloud Infrastructure, crypto-assets and initial coin offerings (ICOs).

  • In order to avoid market fragmentation or even a contradictory policy framework, the WFE agrees with involving global standard setting bodies as part of the GFIN. Moreover, in the face of rapid advances in technology, it is especially important to encourage collaboration at the international regulatory level and develop a common approach and understanding. Internationally agreed frameworks and co-operation will in turn support enhanced efficiency in the form of deference between regulatory bodies. 

You read the WFE’s full response to the GFIN Consultation Paper here.