RBI Issues Draft Framework For Live-Testing Of Financial Services Products

RBI Issues Draft Framework For Live-Testing Of Financial Services Products
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  • This comes after a working group set up the RBI earlier this year recommended introduction of an appropriate framework for a regulatory sandbox within a well-defined space and duration where the financial sector regulator will provide the requisite regulatory guidance, so as to increase efficiency, manage risks and create new opportunities for consumers.
  • The RBI's fintech unit will oversee the sandbox process, including the testing of products and services by eligible entities, the draft framework said.
  • In its draft, the RBI said the participating entity must demonstrate that the product/service is technologically capable for deployment in the broader market, that the entity and its product/service complies with consumer data protection and privacy laws or regulations, and that they build adequate cybersecurity safeguards within their IT system.
  • Applicants, it said, would need to share the results of their proof of concept tests or the results from testing the product or service across different use-cases to be eligible for participation in the sandbox.
  • If any concerns arise about a specific product or service, appropriate modifications can be made before the product is launched in the broader market.


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