Context: Ireland is looking to collaborate with sandboxes in India, to provide Irish companies a test bed for their offerings and learn about the India market.
About Regulatory sandbox:
A sandbox is a closed testing environment. A Regulatory Sandbox allows tests to be performed in a controlled environment, supervised by the competent authorities, to analyze the viability of new business models or the use of new technology in the provision of financial services.
Regulatory Sandbox in India:
- The RBI had issued the 'Enabling Framework for Regulatory Sandbox' in 2019, after wide ranging consultations with stakeholders.
- The objective of the Regulatory Sandbox is to foster responsible innovation in financial services, promote efficiency and bring benefit to consumers.
- Regulatory Sandbox usually refers to live testing of new products or services in a controlled/test regulatory environment for which regulators may (or may not) permit certain relaxations for the limited purpose of the testing.
- Reserve Bank has tweaked guidelines for Regulatory Sandbox (RS) scheme under which participating entities will have to comply with digital personal data protection norms.
- For application to the sandbox, the RBI has laid out detailed criteria for companies -- such as a minimum net worth of Rs 10 lakh, that its technology should be ready for deployment in the broader market, and the company promoters should be ‘fit and proper’.
- Ministry of Communications has introduced spectrum regulatory sandbox for testing telecom equipment. It has outlined two categories for establishment of test zones-
- First Category- urban or populated area zone.
- Second Category- only in uninhabited remote areas.