The Japanese Government has planned a pro-innovation fintech sandbox in a move to foster innovation and encourage startups in such emerging fields and the sharing economy, Nikkei reported.
The government stated that the proposal calling for ‘regulatory sandbox’ will be showcased during a government panel meet on promoting innovation. The sandbox is expected to be in place in the next fiscal year.
The regulatory sandbox framework will enable corporates that are seeking to experiment, to submit their proposals to relevant government agencies that will then grant limited-time authorizations. Under this time period, the trial business need not worry about running afoul of existing procedural requirements and standards, the report stated.
“In the fintech sector, for instance, startups could find it easier to enter the banking industry. That could promote the spread of financial services utilizing smartphones or artificial intelligence,” Nikkei report said.
Earlier this year, Japan’s Financial Services Agency permitted Japan Exchange Group (JPX) to use fintech such as blockchain as a trading platform since, it could make trading more efficient. It also said that the FSA will approve the fintech adoption on a case-by-case basis.
With the launch of the fintech sandbox, business trials could be conducted nationwide. Also, Prime Minister Shinzo Abe's government has designated special zones to serve as beachheads for deregulation.
