The financial sector and the financial and insurance companies with a technological base (“fintech” and “insurtech”) believe that if the creation of the “sandbox” is not approved, Spain will lose the opportunity to become a reference center for testing the most innovative products.
Who said it?
This has been assured to Efe the president of the Spanish Association of Fintech and Insurtech (AEFI), Rodrigo Garcia de la Cruz, who has also highlighted the high driving potential of the “sandbox” in the most innovative companies, since it would increase the figures of employment and investment by 25%.
The creation of this “sandbox” is included in a Draft Bill that the Government announced that it would approve shortly but that the electoral convocation could leave it on paper because, even if it approved it and entered Congress, it would decline with the dissolution of the Chambers, next March 5.
Spain, a European reference
García de la Cruz believes that Spain, which was to become a European reference in the creation of the “sandbox”, now loses a “golden” opportunity to attract capital and innovative projects.
The figures of the AEFI reflect that the sector already invoices around 1,000 million euros, already employs more than 9,000 people, which will be 4,500 additional at the end of this year.
The “sandbox” is a test bank that allows companies working in new developments and innovative financial business models to launch and test their products in a controlled environment, with the backing of regulators and without the potential risks affecting the consumer. final.
The first experience was developed in the United Kingdom, and Singapore and Australia are also leaders in this field
Had it come out ahead, Spain would have become the first Spanish-speaking country to put it into operation and one of the pioneers in Europe, and would be strategically positioned as a European and international platform for start-up companies.
Among the advantages of implementing it is the reduction of costs and time to market innovative financial products and services, better access to finance, the incentive of entrepreneurship and the attraction of foreign investment.
In the preliminary draft law that will now decline with the dissolution of the Cortes, two modalities are included: exemption (in the case of activities that fall under the umbrella of the regulator with current regulations) or non-subjection (if they are activities not yet expressly regulated by their innovative nature).
Under the modality of exemption, the “sandbox” would give innovative entities a period of evidence in which they can meet the requirements (capital, solvency, corporate governance, among others) to obtain the license that allows them to operate in the market.
Sandbox and fintech
In the non-subjection modality, the “sandbox” would be a field of action for the “fintech” and “insurtech” that carry out activities not expressly regulated (for example, the intermediation of cryptocurrencies).
It can also serve as a test bed for legislators and regulators since it allows monitoring activity to develop future regulation and to keep consumers safe from the risks that this type of product could entail.
The “sandbox” license should establish criteria such as the duration of the tests, the maximum number of clients or the type of clients to which the services and products can be directed.
The blueprint put in motion by the CNMV, the Public Treasury and the Spanish Fintech Association establishes that the tests will be carried out under three conditions: surveillance of the competent authorities; delimitation of the duration and characteristics of the tests, and maximum guarantee for the participants when real clients are required.
The banking sector, the savings banks, the insurers, the “fintech” and the credit cooperatives coincided this week in the urgency of approving the “sandbox” to consolidate the dynamism of the innovative ecosystem.
Also published on Medium.